december 2013 - hsbc · 2014-01-15 · fund manager commentary december 2013 4 review: hsbc...

December 2013

Index

1

In this Issue ...

Fund Manager Commentary Pg 2

HSBC Equity Fund Pg 6

HSBC India Opportunities Fund Pg 8

HSBC Midcap Equity Fund Pg 10

HSBC Progressive Themes Fund Pg 12

HSBC Tax Saver Equity Fund Pg 14

HSBC Unique Opportunities Fund Pg 16

HSBC Dynamic Fund Pg 18

HSBC Emerging Markets Fund Pg 20

HSBC Small Cap Fund Pg 21

HSBC Brazil Fund Pg 23

Fund Managers - Equity Pg 24

Comparative Performance of Equity Schemes Pg 26

HSBC MIP - Savings Plan Pg 29

HSBC MIP - Regular Plan Pg 31

HSBC Income Fund - Investment Plan Pg 33

HSBC Income Fund - Short Term Plan Pg 35

HSBC Floating Rate Fund - Long Term Plan Pg 37

HSBC Cash Fund Pg 39

HSBC Gilt Fund Pg 41

HSBC Ultra Short Term Bond Fund Pg 42

HSBC Flexi Debt Fund Pg 44

Fund Managers - MIP & Debt Pg 46

Comparative Performance of MIP & Debt Schemes Pg 47

Fund Manager Commentary December 2013

2

Equity & MIP

Market UpdateEquity market was subjected to a host of news flows during December 2013 and hence remained volatile but returned positive for the month. The keenly watched state assembly election results saw the main opposition party at the centre, BJP garnering most number of seats in the 4 major states and forming governments in all except Delhi. While the actual outcome was more or less in line with the exit poll predictions, we may have to wait for the answer to the larger question of a stable and decisive government at the centre until the general elections in May 2014. But the highlight of the election process was the emergence of the Aam Aadmi Party (AAP), a party born out of the anti-corruption movement and that may set the trend for the upcoming general election too. On the policy front, the Reserve Bank of India (RBI) unexpectedly kept the rates unchanged and indicated that they may take a call after the next inflation data. Food prices and especially the vegetable prices were the larger contributors to the recent spikes in inflation and the RBI assumedly wanted to review the data expecting the vegetable prices to come down due to the winter effect. Globally, the Federal Reserve finally decided on the tapering plan and announced a USD 10 bn reduction in the quantum of monthly bond buying to USD 75 bn starting Jan 2014. The currency was not adversely impacted by the news flow unlike the previous time as the external macro indicators of the country have improvement at the margin.

Market indices BSE Sensex and Nifty returned positive for the month gaining 1.8% & 2.1% respectively. The broader market indices of BSE Midcap & BSE Smallcap outperformed the market indices by a fair margin delivering gains of 6% & 7.4% for the month. This outperformance by the broader indices has helped to narrow their performance gap for CY2013 with the market indices. Amongst the BSE sectoral indices, IT was the best performer at 7.9% while Metals, Real estate & Healthcare were not far behind delivering returns of 5.9%, 5.7% & 4.9% respectively. BSE Auto index was the worst performer losing 0.5% during the month.

The Foreign Institutional Investors (FIIs) continued to bet on the turnaround story in country’s economic growth as they net bought equities worth ~USD 2.5 bn (cash segment) in December 2013. For the calendar year 2013, the FIIs were net buyers to the tune of ~USD 20 bn and marked the second consecutive year of strong net inflows into Indian equities (~USD 25 bn in CY12). The Domestic Institutional Investors (DIIs) continued to remain on the other side of the trade turning net sellers to the tune of USD 1.2 bn for the month. On a full year basis, the DIIs have seen equity outflows of ~USD 12.9 bn.

The Current Account Deficit (CAD) concerns continued to recede as the trade deficit data brought some cheer. The trade deficit figure for November 2013 came in at ~USD 9.2 bn (vs. ~10.6 bn in October 2013) with exports rising by 5.9% (YoY), while imports fell by 16.4% (YoY). Gold imports again saw a sharp fall of 80.3% YoY while Oil imports declined 1.1% YoY.

Equity market influenced by news flows

Source: Bloomberg ; Central Statistical Organization (CSO) India

Source: Bombay Stock Exchange (BSE)

Strong FII flows continued

Trade deficit narrows further

4.00%5.00%6.00%7.00%8.00%9.00%

10.00%

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Repo Rate Movement

Repo Rate

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S&P BSESensex

S&P BSE100

S&P BSE200

S&P BSE500

S&P BSEMidCap

S&P BSESmallCap

Indices Performance - December 2013

Inflation & Industrial GrowthVegetable prices continued to drive inflation up

The headline inflation as measured by the Wholesale Price Index (WPI) inched up further to 7.5% in November 2013 (YoY vs. 7% in October). Rising vegetable prices continued to put pressure on the headline number as the core WPI remained stable at 2.7%. The Consumer Price Index (CPI) also rose to 11.2% in November 2013 (YoY vs. 10.2%) driven by high vegetable prices. The vegetable prices are expected to come down going into the winter season and the RBI is expected to consider rate action after the December 2013 data is out.

High base effect impacts IIP growth

Measure of the country’s factory output or the Index of Industrial Production (IIP) data for October 2013 read a contraction of 1.8% (YoY) after some signs of revival seen in September (+2% YoY). The growth was impacted by the high base effect of the past year. Mining and Manufacturing segments contracted for the month at -3.5% & -2% respectively.

Global Economic Scenario

Finally, clarity on the Fed tapering plan

Putting an end to months of speculation, the US Federal Reserve finally announced its Quantitative Easing (QE) tapering plan from January 2014. As per the plan, the Federal Reserve will reduce the size of the asset purchases by USD 10 bn split evenly between Treasuries and Mortgage – backed securities. Further with the expectation of the economic recovery continuing in the US, the Federal Reserve is expected to reduce the monthly QE quantum through 2014 albeit at a modest pace. Federal Reserve also reaffirmed its commitment to keep the policy rates low. With the uncertainty on the timing of the tapering plan removed, investors can now focus more on the fundamentals of the risk assets globally rather than unduly worrying about the likely liquidity impact. Also, the gradual liquidity withdrawal is also expected have a lesser adverse impact on the emerging markets as the overall global recovery may act as a balancing factor.

Going ForwardDecember 2013 was an eventful month with the domestic news flows such as state assembly poll results, RBI policy review and macro data releases. Federal Reserve tapering plan was most followed global event to have come through during the month. But even after flipping through these, it may be premature to gauge the market direction for the near term yet, as we are stepping into a year which may see more events & the resultant outcomes. The general election in May 2014 is a widely followed event as a new & stable government at the centre, paves way for clarity & continuity in the policy environment. However, given the importance of this event domestically, equity market may remain range bound and sometimes volatile in the run up to the event. Having said that, there are certainly some compelling reasons to look at investing in equities in 2014 from a long term perspective. We may be approaching the bottom of a three year economic bottom and as cycles go, they bounce back after they hit bottom. There are also hopes of a policy revival post a stable government formation at the centre but the general election is still an event with binary consequences though. The market valuations also appear reasonable from a historical point of view. Globally, there are signs of recovery in the US and early hints of a turnaround in the Eurozone as well. All these factors indicate the need to have a constructive view on equities with a long term perspective. As always, it will be prudent for retail investors to have an optimal asset allocation plan and to be aware of their respective risk appetite and risk thresholds. At HSBC, we employ a bottom up stock picking strategy aimed at identifying those profitable companies trading at reasonable valuations. We advise investors to remain invested in equities and utilise the systematic investment plan (SIP) route to invest in a disciplined and regular manner to tide over the market volatility from time to time.

Source: Bloomberg, for all data except where mentioned otherwise


3



3.0%4.0%5.0%6.0%7.0%8.0%9.0%

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Wholesale Price Index Inflation (WPI)

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Index of Industrial Production (IIP)

IIP YoY Growth (New Series; base 2004- 05)


4

Review: HSBC Progressive Themes FundCurrently focusing on the following themes; 1.Economic Reforms (36.6%) which includes Financial sector reform- 29.2% and Oil & Gas Sector deregulation sub theme- 7.4%2.Infrastructure (36.9%) which includes Power- 15%, Construction– 12.3% and Logistics- 9.7%. Well diversified exposure across sectors encompassing the above themes.Review: HSBC Dynamic FundThe cash levels and sector allocation in the fund are likely to change depending on the market conditions and technical factors.Review: HSBC MIP Regular and Savings PlansOur current exposure is 14.87% in HMIP Regular and 24.75%, in HMIP Savings. Currently it is more biased towards large caps than mid or small caps.

Review: HSBC Midcap Equity FundBeing overweight consumer discretionary, healthcare, information technology, materials and underweight financials helped performance while being underweight consumer staples hurt performance.

Sectors HSBC Equity Fund

HSBC India Opportunities

Fund

HSBCMidcap

Equity FundConsumer Discretionary = Consumer Staples Energy = Financials = = Healthcare = = Industrials = =Information Technology Materials Telecommunication = = Utilities

Overweight Underweight = Neutral

Review: HSBC India Opportunities FundBeing overweight consumer discretionary, materials and underweight consumer staples, utilities helped performance while being overweight information technology and underweight energy hurt performance.

Review: HSBC Equity FundBeing overweight information technology, materials and underweight consumer staples, utilities helped performance while being underweight industrials hurt performance.

DebtRBI's Monetary Policy, Economic Events and Data

Monetarypolicy delivers a surprisepause

The Reserve Bank of India (RBI) stayed pat on policy rates at the mid quarter monetary policy review in December 2013. Contrary to wide expectations of rate hike following the faster than expected rise in inflation numbers, trends in constituents of inflation contributed to the surprise pause from the RBI. That said, the RBI has put in caveats for further policy measures which include the upcoming prints of inflation.

The pick-up in real GDP growth in Q2 of 2013-14, although modest, was driven largely by robust growth of agricultural activity, supported by an improvement in net exports. However, the weakness in industrial activity persisting into Q3, and lackluster lead indicators of services and subdued domestic consumption demand suggest continuing headwinds to growth. Tightening government spending in Q4 to meet budget projections will add to these headwinds.

Wholesale inflation has gone up sharply from Q2 onwards, with upside pressures evident across all constituent components. Retail inflation measured by the consumer price index (CPI) has risen unrelentingly through the year so far, pushed up by the unseasonal upturn in vegetable prices, double-digit housing inflation and elevated levels of inflation in the non-food and non-fuel categories. High inflation at both wholesale and retail level risks entrenching inflation expectations at unacceptably elevated levels, posing a threat to growth and financial stability. There are also signs of a resumption of high rural wage growth, suggesting second round effects that cannot be ignored.

As regards to external sector, the narrowing of the trade deficit since June through November 2013, on positive export growth and contraction in both oil and non-oil imports might bring the current account deficit (CAD) down to a more sustainable level for the year as a whole.

Robust inflows into the swap windows opened by the RBI during August-November 2013 have contributed significantly to rebuilding foreign exchange reserves thus covering possible external financing requirements and providing stability to the foreign exchange market. Looking ahead, these favourable developments might help to build resilience to external shocks.

IIP continues to remain benign whereas inflation prints an upward surprise

India’s industrial production growth fell to -1.8% year on year (YoY) in October 2013 from 2% YoY in September, lower than market expectation of -1.2%. Adverse base effects, lower infrastructure output growth and weak demand led to the decline.

Wholesale Price Index (WPI) inflation rose to 7.5% YoY in November 2013 from 7.0% in October, led by a spike in vegetable price inflation.

Consumer Price Index (CPI) inflation rose to 11.2% YoY in November 2013 from 10.2% in October, substantially above expectations of 10.0%. Recent fall in vegetable prices would be captured in future prints, albeit rise in other food products and wages would keep CPI sticky at near double digit levels. Core CPI inflation was unchanged at 8.2% YoY in November 2013.

Market Activity

Bonds remain listless

Bond yields witnessed easing across the yield curve. Positive surprise on the policy outcome, prospects of easing in certain inflation constituents (vegetables) and expected easier liquidity scenario from January 2013 led to bond yields easing by 15 – 20 bps for the month.The RBI, at its post policy call also provided some comfort on the proposed debt switch; wherein Dy. Governor mentioned that the debt switch would be conducted in a way without adversely impacting the yield. It may be noted that the recent steepness in the yield curve is also owing to the concerns around the debt switch wherein the RBI would buy back short end bonds and issue long end bonds so as to neutralize the heavy sovereign maturities scheduled in the next fiscal.

Limited supply in corporate bonds

Credit segment remained supported with the lack of supply. Issuers were less incentivised to raise resources via bond route as spreads between bank loans and bond rates were lower and healthy inflows in the tax free issuances. Seasonal end-investor demand during the onset of the new year also ensured that credit segment remained well bid.

MSF continues to remain operative rate

Money market rates continued to drift lower expecting further relaxation in liquidity measures in-spite of seasonal tightening on back of advance tax outflow. However, higher government balance towards the end of the month led to Marginal Standing Facility (MSF) being operative rate.

Global Economy

In a surprise move Federal Open Market Committee (FOMC) at its December 2013 meet announced a taper of 10 bn as against the original 85 bn programme. This announcement on the back of stronger data in the US economy has led to rise in US treasuries trading at recent highs of 3% levels.

Going Forward

The Reserve Bank of India has opted to buy more time to determine further action to quell inflation. After two consecutive rate hikes in the past meetings to anchor inflation expectations, markets had priced in further rate moves in similar direction owing to faster than expected rise in inflation prints. Forward guidance denotes higher weightage on trajectory of inflation constituents, especially food and fuel.

Recent evidences of lowering of vegetable prices in December 2013 amidst stable commodity prices provide further comfort for the RBI. Disinflationary impact of exchange rate stability and lagged effect of recent monetary tightening might also contribute to contain the pace of inflation. It may also be noted that the lower growth prospects could be even further dented as the Government embarks on reducing the expenditure during the remaining part if this fiscal. This exemplifies the RBI’s “close call’ to stay pat on the policy rates.

Considering the above, we expect yield curve to undergo steepness with long end rates remaining range bound. Comfortable liquidity scenario negates prospects of open market operations implying pressure on the medium – long term yields. Key risks in the near term would include the mode of debt switch by the RBI and impact of tapering of the US quantitative easing. Recent mop up of forex reserves by the RBI provide further comfort on the Indian Rupee (INR) front and hence the markets would be better prepared to weather the US tapering. On other hand prices of long term segment are already reflecting these negative sentiments and may get positive push from buying by foreign investors. Hence, we would maintain neutral duration stance currently.

Source: Bloomberg, for all data except where mentioned otherwise


5

An Open Ended Diversified Equity SchemeInvestment Objective: Aims to generate long term capital growth from an actively managed portfolio of equity and equity related securities.

Issuer Market Value(` in Lacs)

% to NetAssets

Auto Tata Motors 1,505.60 3.31%Maruti Suzuki India 881.95 1.94%Bajaj Auto 535.04 1.18%Auto AncillariesMotherson Sumi Systems 821.25 1.81%Banks ICICI Bank 3,570.94 7.86%Axis Bank 2,599.10 5.72%Yes Bank 1,203.15 2.65%HDFC Bank 998.78 2.20%Bank of Baroda 484.16 1.07%Construction ProjectLarsen & Toubro 1,337.81 2.94%Consumer Non DurablesI T C 2,413.88 5.31%Ferrous MetalsTata Steel 1,272.60 2.80%Jindal Steel & Power 913.50 2.01%Fertilisers Coromandel International 987.47 2.17%Finance HDFC 993.31 2.19%Media & EntertainmentSun TV Network 1,026.81 2.26%Minerals/Mining Sesa Sterlite 1,312.68 2.89%NMDC 567.60 1.25%Oil Oil & Natural Gas Corporation 2,311.20 5.09%Cairn India 971.25 2.14%Petroleum Products Reliance Industries 1,790.40 3.94%Pharmaceuticals Dr Reddy’s Laboratories 1,774.22 3.90%Sun Pharmaceutical Industries 766.06 1.69%Lupin 726.52 1.60%PowerNTPC 479.50 1.06%Software Infosys 3,485.65 7.67%HCL Technologies 3,156.38 6.95%Tata Consultancy Services 1,629.04 3.58%Tech Mahindra 1,378.39 3.03%Wipro 559.20 1.23%Telecom - Services Bharti Airtel 1,238.44 2.73%Total 96.17%

HSBC Equity Fund (HEF) December 2013

6


% to NetAssets

Other Equity Investments 55.15 0.12%Reverse Repos 1,786.97 3.93%CBLOs 870.96 1.92%Net Current Assets -960.63 -2.14%Total Net Assets as on 31 December 2013 45,444.30 100.00%

Asset AllocationAuto 6.43%Auto Ancillaries 1.81%Banks 19.50%Construction Project 2.94%Consumer Non Durables 5.31%Ferrous Metals 4.81%Fertilisers 2.17%Finance 2.19%Media & Entertainment 2.26%Minerals/Mining 4.14%Oil 7.23%Petroleum Products 3.94%Pharmaceuticals 7.19%Power 1.06%Software 22.46%Telecom - Services 2.73%Other Equity Investments 0.12%Reverse Repos/CBLOs 5.85%Net Current Assets -2.14%Total Net Assets 100.00%

Dividend DeclarationRecord Date / period of

dividend declaredDividend (` per unit)

Non-InstitutionalDividend (` per unit)

InstitutionalNAV (`) per unit(cum dividend)

HSBC Equity Fund - Dividend28-May-10 1.50 1.50 26.691119-Nov-10 2.00 2.00 29.324422-Feb-13 2.50 2.50 26.1962HSBC Equity Fund - Dividend Direct Plan22-Feb-13 2.50 2.50 26.2505

Date of Allotment 10-Dec-02Benchmark S&P BSE 200NAV (Growth) per unit(as on 31.12.13)

` 109.8215

Fund Managers Neelotpal SahaiSIP AvailableMinimumApplicationAmount

` 10,000` 1,000 p.m.(SIP)

Exit Load@ NilStatistical Ratios

Standard Deviation 0.91%R-Squared 0.9608Beta (Slope) 0.9246Sharpe Ratio** -0.0223Total Expense Ratio as on December 31, 2013

Regular 2.48% Direct Plan 1.77% Excludes service tax on Investment Management fees of 0.18% of Total Net Assets. Annualised Expense Ratio from 1st April 2013 onwards

Regular 2.47% Direct Plan 1.76% Excludes service tax on Investment Management fees of 0.18% of Total Net Assets. Portfolio Turnover 0.69

Statistical ratios disclosed as per daily returns of the last 3 years/since inception, whichever is later. @ Effective from March 1, 2013 for prospective investments. **Risk free rate: 10 yr Gsec: 8.83% as on December 31, 2013.

HSBC Equity Fund (HEF) December 2013

7

Upon payment of dividend, the NAV per unit falls to the extent of payout and statutory levy, if any. Face value: `10 per unit.

This Product is suitable for investors who are seeking* :l To create wealth over long terml Investment in equity and equity related securitiesl High risk (Brown)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

An Open Ended Flexi-Cap Equity SchemeInvestment Objective: Seeks long term capital growth through investments across all market capitalisations, including small, mid and large cap stocks. It aims to be predominantly invested in equity & equity related securities. However it could move a significant portion of its assets towards fixed income securities if the fund manager becomes negative on equity markets.


% to NetAssets

Auto Eicher Motors 671.74 3.88%Tata Motors 564.60 3.26%Auto AncillariesBalkrishna Industries 510.75 2.95%Banks ICICI Bank 1,208.63 6.99%Axis Bank 818.72 4.73%Yes Bank 462.75 2.67%HDFC Bank 366.22 2.12%ING Vysya Bank 367.47 2.12%Cement Shree Cement 434.22 2.51%Construction Prestige Estates Project 365.51 2.11%Construction ProjectsLarsen & Toubro 535.13 3.09%Consumer Non Durables I T C 965.55 5.58%Britannia Industries 368.24 2.13%Ferrous MetalsTata Steel 636.30 3.68%Finance HDFC 357.59 2.07%LIC Housing Finance 328.88 1.90%Industrial ProductsSupreme Industries 595.07 3.44%Media & EntertaintmentDish TV India 242.60 1.40%Minerals/MiningSesa Sterlite 454.39 2.63%Oil Oil & Natural Gas Corporation 650.03 3.76%Petroleum Products Reliance Industries 447.60 2.59%Pharmaceuticals Aurobindo Pharma 451.72 2.61%Glenmark Pharmaceuticals 400.39 2.31%Divi's Laboratories 366.41 2.12%PowerCESC 419.27 2.42%Software Infosys 958.55 5.54%HCL Technologies 820.66 4.74%Tech Mahindra 367.57 2.12%Eclerx Services 319.59 1.85%Mindtree 305.72 1.77%Telecom - ServicesBharti Airtel 396.30 2.29%Textile ProductArvind 478.63 2.77%Textile CottonVardhman Textiles 376.75 2.18%Total 98.33%

HSBC India Opportunities Fund (HIOF) December 2013

8


% to NetAssets

Reverse Repos 474.46 2.74%CBLOs 231.25 1.34%Net Current Assets -418.21 -2.41%Total Net Assets as on 31 December 2013 17,301.01 100.00%

Asset AllocationAuto 7.14%Auto Ancillaries 2.95%Banks 18.63%Cement 2.51%Construction 2.11%Construction Project 3.09%Consumer Non Durables 7.71%Ferrous Metals 3.68%Finance 3.97%Industrial Products 3.44%Media & Entertaintment 1.40%Minerals/Mining 2.63%Oil 3.76%Petroleum Products 2.59%Pharmaceuticals 7.04%Power 2.42%Software 16.02%Telecom - Services 2.29%Textile Products 2.77%Textile Cotton 2.18%Reverse Repos/CBLOs 4.08%Net Current Assets -2.41%Total Net Assets 100.00%





HSBC India Opportunities Fund - Dividend11-Dec-09 1.00 1.00 16.901319-Nov-10 1.00 1.00 18.23134-Feb-13 1.50 1.50 17.7319HSBC India Opportunities Fund - Dividend Direct Plan4-Feb-13 1.50 1.50 17.7519

Date of Allotment 24-Feb-04Benchmark S&P BSE 500NAV (Growth) per unit(as on 31.12.13)

` 41.0027

Fund Manager Neelotpal SahaiSIP AvailableMinimumApplication Amount

` 10,000` 1,000 p.m.(SIP)





Statistical ratios disclosed as per daily returns of the last 3 years/since inception, whichever is later. @ Effective from March 1, 2013 for prospective investments.**Risk free rate: 10 yr Gsec: 8.83% as on December 31, 2013.

HSBC India Opportunities Fund (HIOF) December 2013

9


This Product is suitable for investors who are seeking* :l To create wealth over long terml Invests in equity and equity related securities across market capitalisationsl High risk (Brown)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

An Open Ended Diversified Equity SchemeInvestment Objective: Seeks to generate long term capital growth from an actively managed portfolio of equity and equity related securities primarily being midcap stocks. However, it could move a portion of its assets towards fixed income securities if the fund manager becomes negative on the Indian equity markets.


% to NetAssets

Auto Ancillaries Apollo Tyres 501.70 6.18%Balkrishna Industries 171.23 2.11%Banks Dena Bank 293.36 3.61%The Jammu & Kashmir Bank 287.28 3.54%Development Credit Bank 206.72 2.55%State Bank of Bikaner and Jaipur 140.00 1.72%Allahabad Bank 123.57 1.52%State Bank of Travancore 114.18 1.41%CementEverest Industries 208.12 2.56%ConstructionBF Utilities 149.94 1.85%Construction ProjectKEC International 121.96 1.50%Consumer Durables Bata India 273.98 3.38%Consumer Non DurablesGodfrey Phillips India 141.29 1.74%Venky’s (India) 135.40 1.67%FinanceCholamandalam Investment & Fin. Co. 211.07 2.60%Industrial Capital GoodsBEML 149.66 1.84%Swelect Energy System 84.66 1.04%Industrial Products Diamond Power Infrastructure 185.22 2.28%Minerals/Mining Gujarat Mineral Development Corporation 243.10 2.99%PesticidesPI Industries 576.48 7.10%UPL 516.65 6.36%Bayer Cropscience 123.76 1.52%PharmaceuticalsAurobindo Pharma 416.37 5.13%Alembic Pharmaceuticals 327.21 4.03%Biocon 141.14 1.74%PowerJSW Energy 149.03 1.84%Software Tech Mahindra 385.95 4.75%Persistent Systems 290.44 3.58%Nucleus Software Exports 229.70 2.83%Polaris Financial Technology 154.69 1.91%Textile - CottonVardhman Textiles 302.13 3.72%Textile ProductsArvind 170.94 2.11%Siyaram Silk Mills 104.76 1.29%Transportation Adani Ports and Special Economic Zone 155.40 1.91%Gateway Distriparks 138.86 1.71%Total 97.62%

HSBC Midcap Equity Fund (HMEF) December 2013

10


% to NetAssets

Other Equity Investments 177.55 2.19%Reverse Repos 41.73 0.51%CBLOs 20.34 0.25%Net Current Assets -48.37 -0.57%Total Net Assets as on 31 December 2013 8,117.16 100.00%

Asset AllocationAuto Ancillaries 8.29%Banks 14.35%Cement 2.56%Construction 1.85%Construction Project 1.50%Consumer Durables 3.38%Consumer Non Durables 3.41%Finance 2.60%Industrial Capital Goods 2.88%Industrial Products 2.28%Minerals/Mining 2.99%Pesticides 14.98%Pharmaceuticals 10.90%Power 1.84%Software 13.07%Textile Products 3.40%Textiles - Cotton 3.72%Transportation 3.62%Other Equity Investments 2.19%Reverse Repos/Cblos 0.76%Net Current Assets -0.57%Total Net Assets 100.00%





HSBC Midcap Equity Fund - Dividend24-Mar-08 0.75 0.75 13.379711-Dec-09 1.00 1.00 13.892719-Nov-10 2.00 2.00 15.4864

Date of Allotment 19-May-05Benchmark S&P BSE MidcapNAV (Growth) per unit(as on 31.12.13)

` 19.7673

Fund Manager Dhiraj SachdevSIP AvailableMinimumApplicationAmount

` 10,000` 1,000 p.m.(SIP)





Statistical ratios disclosed as per daily returns of the last 3 years/since inception, whichever is later. @ Effective from March 1, 2013 for prospective investments.**Risk free rate: 10 yr Gsec: 8.83% as on December 31, 2013.

HSBC Midcap Equity Fund (HMEF) December 2013

11


Our exposure to midcap stocks in HSBC Midcap Equity Fund (HMEF) is 92.2900%

This Product is suitable for investors who are seeking* :l To create wealth over long terml Invests in predominantly mid cap equity and equity related securitiesl High risk (Brown)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

An Open Ended Flexi-Theme Equity SchemeInvestment Objective: Seeks to generate long term capital growth from an actively managed portfolio of equity and equity related securities by investing primarily in sectors, areas and themes that play an important role in, and/or benefit from India’s progress, reform process and economic development.


% to NetAssets

Auto Tata Motors DVR 310.01 2.94%Auto Ancillaries Apollo Tyres 645.34 6.12%Banks The Jammu & Kashmir Bank 623.68 5.92%ICICI Bank 532.89 5.05%Dena Bank 440.80 4.18%The Karnataka Bank 372.69 3.53%Indian Bank 306.64 2.91%Union Bank of India 169.52 1.61%United Bank of India 108.02 1.02%CementEverest Industries 309.09 2.93%HIL 132.62 1.26%JK Cement 117.85 1.12%ConstructionIRB Infrastructure Developers 231.63 2.20%National Buildings Construction Corporation 174.46 1.65%Construction ProjectsGammon Infrastructure Projects 120.41 1.14%Finance Rural Electrification Corporation 529.44 5.02%GasGujarat State Petronet 122.00 1.16%Industrial Capital GoodsBEML 162.48 1.54%Industrial Products FAG Bearings India 461.82 4.38%Diamond Power Infrastructure 225.47 2.14%Minerals/MiningGujarat Mineral Development Corporation 345.59 3.28%Petroleum Products Hindustan Petroleum Corporation 512.57 4.86%Indian Oil Corporation 143.91 1.36%Power JSW Energy 423.38 4.02%Reliance Infrastructure 372.53 3.53%Power Grid Corporation of India 274.73 2.61%CESC 116.46 1.10%ServicesAditya Birla Nuvo 484.65 4.60%Textile - Cotton Vardhman Textiles 376.75 3.57%TransportationGateway Distriparks 567.54 5.38%Adani Ports And Special Economic Zone 349.65 3.32%Total 95.45%

HSBC Progressive Themes Fund (HPTF) December 2013

12


% to NetAssets


Asset AllocationAuto 2.94%Auto Ancillaries 6.12%Banks 24.22%Cement 5.31%Construction 3.85%Construction Project 1.14%Finance 5.02%Gas 1.16%Industrial Capital Goods 1.54%Industrial Products 6.52%Minerals/Mining 3.28%Petroleum Products 6.22%Power 11.26%Services 4.60%Textiles - Cotton 3.57%Transportation 8.70%Other Equity Investments 4.43%Reverse Repos/CBLOs 1.13%Net Current Assets -1.01%Total Net Assets 100.00%





HSBC Progressive Themes Dividend11-May-07 1.00 1.00 12.239026-May-08 1.00 1.00 13.7160

Date of Allotment 23-Feb-06Benchmark S&P BSE 200NAV (Growth) per unit(as on 31.12.13)

` 9.9328


` 10,000` 1,000 p.m.(SIP)






HSBC Progressive Themes Fund (HPTF) December 2013

13


This Product is suitable for investors who are seeking* :l To create wealth over long terml Invests in equity and equity related securities, primarily in themes that play an important role in India’s economic developmentl High risk (Brown)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

An Open Ended Equity Linked Savings Scheme (ELSS)Investment Objective: Aims to provide long term capital appreciation by investing in a diversified portfolio of equity & equity related instruments of companies across various sectors and industries, with no capitalisation bias. The Fund may also invest in fixed income securities.


% to NetAssets

Auto Maruti Suzuki India 517.40 3.05%Auto Ancillaries MRF 638.64 3.77%Motherson Sumi Systems 519.87 3.07%Amara Raja Batteries 311.27 1.84%Banks ICICI Bank 1,027.33 6.06%HDFC Bank 790.70 4.66%Federal Bank 429.13 2.53%Indusind Bank 391.25 2.31%ING Vysya Bank 308.33 1.82%Jammu & Kashmir Bank 229.82 1.36%Cement Shree Cements 917.03 5.41%The Ramco Cements 464.76 2.74%Construction ProjectLarsen & Toubro 535.13 3.16%Consumer DurablesHavells India 337.42 1.99%Whirlpool of India 252.61 1.49%Consumer Non DurablesI T C 848.07 5.00%McLeod Russel India 562.18 3.31%United Spirits 354.76 2.09%Nestle India 247.54 1.46%Fertilisers Coromandel International 276.32 1.63%Finance HDFC 647.24 3.82%LIC Housing Finance 332.01 1.96%Sundaram Finance 289.76 1.71%GasPetronet LNG 225.79 1.33%Industrial Capital GoodsCrompton Greaves 498.07 2.94%Industrial ProductsSupreme Industries 629.64 3.71%OilOil & Natural Gas Corporation 390.02 2.30%Pharmaceuticals Aurobindo Pharma 416.37 2.46%Divi's Laboratories 370.84 2.19%Lupin 358.72 2.12%Ipca Laboratories 323.60 1.91%Software Tata Consultancy Services 781.94 4.61%Infosys 704.10 4.15%Tech Mahindra 420.87 2.48%Telecom - Services Bharti Airtel 433.95 2.56%Total 99.00%

HSBC Tax Saver Equity Fund (HTSF) December 2013

14

Date of Allotment 05-Jan-07Benchmark S&P BSE 200NAV (Growth) per unit(as on 31.12.13)

` 17.3232

Fund Manager Aditya KhemaniSIP AvailableMinimumApplicationAmount

` 500(Lumpsum & SIP)



Regular 2.60% Direct Plan 1.90% Excludes service tax on Investment Management fees of 0.19% of Total Net Assets.Annualised Expense Ratio from 1st April 2013 onwards




% to NetAssets


Asset AllocationAuto 3.05%Auto Ancillaries 8.68%Banks 18.74%Cement 8.15%Construction Project 3.16%Consumer Durables 3.48%Consumer Non Durables 11.86%Fertilisers 1.63%Finance 7.49%Gas 1.33%Industrial Capital Goods 2.94%Industrial Products 3.71%Oil 2.30%Pharmaceuticals 8.68%Software 11.24%Telecom - Services 2.56%Other Equity Investments 0.93%Reverse Repos/CBLOs 0.43%Net Current Assets -0.36%Total Net Assets 100.00%





HSBC Tax Saver Equity Dividend19-Feb-10 1.00 1.00 12.8713

HSBC Tax Saver Equity Fund (HTSF) December 2013

15


This Product is suitable for investors who are seeking* :l To create wealth over long terml Invests in equity and equity related securities with no market capitilastion biasl High risk (Brown)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.

Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

An Open Ended Equity SchemeInvestment Objective: To provide long-term capital growth from a diversified portfolio of equity and equity related instruments. The focus would be to invest in stocks of companies facing “out-of-ordinary” conditions.


% to NetAssets

Auto Maruti Suzuki India 114.65 2.51%Bajaj Auto 105.10 2.30%Auto Ancillaries Amara Raja Batteries 120.29 2.63%Motherson Sumi System 113.07 2.47%Banks ICICI Bank 292.27 6.39%HDFC Bank 202.02 4.42%Karur Vysya Bank 115.13 2.52%Bank of Baroda 105.87 2.31%Federal Bank 92.46 2.02%The Jammu & Kashmir Bank 81.49 1.78%CementShree Cements 108.56 2.37%Grasim Industries 91.21 1.99%Construction ProjectsLarsen & Toubro 156.52 3.42%Consumer Non DurablesI T C 285.42 6.24%McLeod Russel India 103.72 2.27%Ferrous MetalsTata Steel 87.39 1.91%FertilisersCoromandel International 89.91 1.97%FinanceIDFC 142.48 3.11%LIC Housing Finance 114.01 2.49%HDFC 110.30 2.41%Industrial Products Supreme Industries 127.52 2.79%Minerals/MiningNMDC 85.14 1.86%Non - Ferrous Metals Hindustan Zinc 70.36 1.54%Oil Oil & Natural Gas Corporation 180.56 3.95%Petroleum Products Reliance Industries 139.65 3.05%Pharmaceuticals Divi's Laboratories 143.51 3.14%Lupin 118.97 2.60%Software Infosys 363.38 7.94%Tata Consultancy Services 207.43 4.53%HCL Technologies 153.84 3.36%Tech Mahindra 94.65 2.07%Telecom - Services Bharti Airtel 102.38 2.24%Total 96.60%

HSBC Unique Opportunities Fund (HUOF) December 2013

16


% to NetAssets


Asset AllocationAuto 4.81%Auto Ancillaries 5.10%Banks 19.44%Cement 4.36%Construction Projects 3.42%Consumer Non Durables 8.51%Ferrous Metals 1.91%Fertilisers 1.97%Finance 8.01%Industrial Products 2.79%Minerals/Mining 1.86%Non - Ferrous Metals 1.54%Oil 3.95%Petroleum Products 3.05%Pharmaceuticals 5.74%Software 17.90%Telecom - Services 2.24%Other Equity Investments 0.84%Reverse Repos/CBLOs 3.26%Net Current Assets -0.70%Total Net Assets 100.00%

Date of Allotment 21-Mar-07Benchmark S&P BSE 200NAV (Growth) per unit(as on 31.12.13)

` 11.5433

Fund Manager Gaurav Mehrotra & Amaresh Mishra

SIP AvailableMinimumApplicationAmount

` 10,000` 1,000 p.m.(SIP)


Standard Deviation 0.89%R-Squared,m 0.9422Beta (Slope) 0.8977Sharpe Ratio** -0.0311Total Expense Ratio as on December 31, 2013

Regular 2.70% Direct Plan 2.01% Excludes service tax on Investment Management fees of 0.20% of Total Net Assets.Annualised Expense Ratio from 1st April 2013 onwards

Regular 2.70% Direct Plan 2.00% Excludes service tax on Investment Management fees of 0.21% of Total Net Assets.Portfolio Turnover 0.48


HSBC Unique Opportunities Fund (HUOF) December 2013

17

This Product is suitable for investors who are seeking* :l To create wealth over long terml Invests in equity and equity related securities of companies facing “out-of-ordinary” conditionsl High risk (Brown)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

An Open Ended SchemeInvestment Objective: To provide long term capital appreciation by allocating funds in equity and equity related instruments. It also has the flexibility to move, entirely if required, into debt instruments in times that the view on equity markets seems negative.


% to NetAssets

AutoTata Motors 357.58 4.12%

Maruti Suzuki India 176.39 2.03%

Banks ICICI Bank 494.44 5.70%

Axis Bank 454.84 5.24%

HDFC Bank 332.93 3.84%

CementGrasim Industries 135.73 1.56%

Construction ProjectsLarsen & Toubro 278.27 3.21%

Consumer Non DurablesI T C 563.24 6.49%

Hindustan Unilever 136.96 1.58%

Ferrous Metals Tata Steel 212.10 2.44%

Finance HDFC 278.13 3.20%

Minerals/Mining Sesa Sterlite 151.46 1.75%

NMDC 106.43 1.23%

Oil Oil & Natural Gas Corporation 216.68 2.50%

Petroleum Products Reliance Industries 447.60 5.16%

Pharmaceuticals Cipla 220.44 2.54%

Sun Pharmaceutical Industries 141.86 1.63%

PowerNTPC 137.00 1.58%

Power Grid Corporation of India 99.90 1.15%

Services Aditya Birla Nuvo 173.98 2.00%

Software Infosys 522.85 6.02%

HCL Technologies 340.89 3.93%

Tata Consultancy Services 162.90 1.88%

Telecom - Services Bharti Airtel 115.59 1.33%

Total 72.11%

HSBC Dynamic Fund (HDF) December 2013

18


% to NetAssets

Other Equity Investments 202.03 2.33%Reverse Repos 1,576.75 18.17%CBLOs 768.50 8.85%Net Current Assets -126.25 -1.46%Total Net Assets as on 31 December 2013 8,679.18 100.00%

Asset AllocationAuto 6.15%Banks 14.78%Cement 1.56%Construction Projects 3.21%Consumer Non Durables 8.07%Ferrous Metals 2.44%Finance 3.20%Minerals/Mining 2.98%Oil 2.50%Petroleum Products 5.16%Pharmaceuticals 4.17%Power 2.73%Services 2.00%Software 11.83%Telecom - Services 1.33%Other Equity Investments 2.33%Reverse Repos/CBLOs 27.02%Net Current Assets -1.46%Total Net Assets 100.00%

Date of Allotment 24-Sep-07Benchmark S&P BSE 200NAV (Growth) per unit(as on 31.12.13)

` 10.5137

Fund Manager Neelotpal Sahai(for Equity portion)Sanjay Shah (for Fixed Income portion)


` 10,000` 1,000 p.m.(SIP)






HSBC Dynamic Fund (HDF) December 2013

19

This Product is suitable for investors who are seeking* :l To create wealth over long terml Invests in equity and equity related securities and in debt instruments when view on equity markets is negativel High risk (Brown)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

Date of Allotment 17-Mar-08Benchmark MSCI Emerging

Markets IndexNAV (Growth) per unit(as on 30.12.13)

` 11.4576

Fund Manager Piyush Harlalka (Dedicated fund manager for overseas investments)


` 10,000` 1,000 p.m.(SIP)


Standard Deviation 1.55%R-Squared 0.2590Beta (Slope) 1.1100Sharpe Ratio** 0.0100Total Expense Ratio as on December 31, 2013

Regular 2.70% Direct Plan 2.00% (inclusive of underlying scheme’s expenses) Excludes service tax on Investment Management fees of 0.11% of Total Net Assets.Annualised Expense Ratio from 1st April 2013 onwards

Regular 2.71% Direct Plan 2.00% (inclusive of underlying scheme’s expenses) Excludes service tax on Investment Management fees of 0.11% of Total Net Assets. Portfolio Turnover 0.41


Asset AllocationOverseas Mutual Fund 99.03%Reverse Repos/CBLOs 2.06%Net Current Assets -1.09%Total Net Assets 100.00%


% to NetAssets

Overseas Mutual FundHSBC GIF Glob Emerg Mkts Eq S1 Dis 1,668.39 99.03%CBLOs 34.71 2.06%Net Current Assets -18.45 -1.09%Total Net Assets as on 31 December 2013 1,684.65 100.00%

An Open Ended SchemeInvestment Objective: To provide long term capital appreciation by investing in India and in the emerging markets, in equity and equity related instruments, share classes and units/securities issued by overseas mutual funds or unit trusts. The fund may also invest a limited proportion in domestic debt and money market instruments.

HSBC Emerging Markets Fund (HEMF) December 2013

20

This Product is suitable for investors who are seeking* :l To create wealth over long terml Investment in equity and equity related securities of Emerging economiesl High risk (Brown)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.


An Open Ended Equity SchemeInvestment Objective: To provide long term capital appreciation primarily from a diversified portfolio of equity and equity related instruments of small cap companies.


% to NetAssets

AutoVST Tillers Tractors 13.48 1.02%Auto Ancillaries Suprajit Engineering 73.90 5.61%Balkrishna Industries 49.37 3.75%Majestic Auto 34.69 2.63%Banks State Bank of Travancore 60.97 4.63%State Bank of Bikaner and Jaipur 50.82 3.86%The Karnataka Bank 47.84 3.63%Dena Bank 47.42 3.60%Development Credit Bank 40.80 3.10%Cement Orient Cement 83.73 6.35%Chemicals India Glycols 35.59 2.70%Consumer Durables Bata India 28.45 2.16%Orient Paper & Industries 26.77 2.03%Greenply Industries 13.62 1.03%Consumer Non DurablesGodfrey Phillips India 39.06 2.96%Globus Spirits 25.49 1.93%Lakshmi Energy and Foods 19.15 1.45%FinanceCholamandalam Investment Finance Co. 39.26 2.98%Industrial Capital GoodsIndo Tech Transformers 28.38 2.15%TIL 27.49 2.09%Sanghvi Movers 26.15 1.98%Industrial Products Ador Welding 18.82 1.43%Minerals/MiningGujarat Mineral Development Corporation 26.11 1.98%PesticidesPI Industries 32.97 2.50%PharmaceuticalsAurobindo Pharma 68.74 5.22%Alembic Pharmaceuticals 33.78 2.56%Software Nucleus Software Exports 131.41 9.97%Tech Mahindra 33.08 2.51%Textile - Products SRF 31.03 2.35%Textile - Cotton RSWM 96.99 7.36%Transportation Adani Ports and Special Economic Zone 31.08 2.36%Total 99.88%

HSBC Small Cap Fund (HSCF) December 2013

21


% to NetAssets

Reverse Repos 32.60 2.47%CBLOs 15.89 1.21%Net Current Assets -46.94 -3.56%Total Net Assets as on 31 December 2013 1,318.00 100.00%

Asset AllocationAuto 1.02%Auto Ancillaries 11.99%Banks 18.82%Cement 6.35%Chemicals 2.70%Consumer Durables 5.22%Consumer Non Durables 6.34%Finance 2.98%Industrial Capital Goods 6.22%Industrial Products 1.43%Minerals/Mining 1.98%Pesticides 2.50%Pharmaceuticals 7.78%Software 12.48%Textile - Products 2.35%Textile - Cotton 7.36%Transportation 2.36%Reverse Repos/CBLOs 3.68%Net Current Assets -3.56%Total Net Assets 100.00%





HSBC Small Cap Fund - Dividend19-Nov-10 1.00 1.00 14.3053

Date of Allotment 24-Mar-08

Benchmark S&P BSE Small Cap Index

NAV (Growth) per unit(as on 31.12.13)

` 9.9659


` 10,000` 1,000 p.m.(SIP)





Statistical ratios disclosed as per returns of the last 3 years/since inception, whichever is later.@ Effective from March 1, 2013 for prospective investments.**Risk free rate: 10 yr Gsec: 8.83% as on December 31, 2013.

HSBC Small Cap Fund (HSCF) December 2013

22


Our exposure to small cap stocks in HSBC Small Cap Fund (HSCF) is 87.6300%

This Product is suitable for investors who are seeking* :l To create wealth over long terml Invests in predominantly small cap equity and equity related securitiesl High risk (Brown)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.


Date of Allotment 06-May-11Benchmark MSCI Brazil

10/40 IndexNAV (Growth) per unit(as on 30.12.13)

` 8.9690

Fund Manager Piyush Harlalka (Dedicated fund manager for overseas investments)


` 10,000` 1,000 p.m.(SIP)



Regular 2.70% Direct Plan 2.00% (inclusive of underlying scheme’s expenses) Excludes service tax on Investment Management fees of 0.11% of Total Net Assets.Annualised Expense Ratio from 1st April 2013 onwards

Regular 2.71% Direct Plan 2.00% (inclusive of underlying scheme’s expenses) Excludes service tax on Investment Managementfees of 0.11% of Total Net Assets. Portfolio Turnover 0.04


Asset AllocationOverseas Mutual Fund 98.25%Reverse Repos/CBLOs 3.19%Net Current Assets -1.44%Total Net Assets 100.00%


% to NetAssets

Overseas Mutual FundHSBC GIF BRAZIL EQUITY S3D 10,661.96 98.25%CBLOs 346.28 3.19%

Net Current Assets -156.69 -1.44%

Total Net Assets as on 31 December 2013 10,851.56 100.00%

An Open-Ended Fund of Funds SchemeInvestment Objective: The primary investment objective of the Scheme is to provide long term capital appreciation by investing predominantly in units/shares of HSBC Global Investment Funds (HGIF) Brazil Equity Fund. The Scheme may, at the discretion of the Investment Manager, also invest in the units of other similar overseas mutual fund schemes, which may constitute a significant part of its corpus. The Scheme may also invest a certain proportion of its corpus in money market instruments and/or units of liquid mutual fund schemes, in order to meet liquidity requirements from time to time.

HSBC Brazil Fund (HBF) December 2013

23

This Product is suitable for investors who are seeking* :l To create wealth over long terml Invests in equity and equity related securities through feeder route in Brazilian marketsl High risk (Brown)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

Name of Scheme Fund Manager

HSBC Equity Fund Neelotpal Sahai (from 27 May 2013)

HSBC India Opportunities Fund Neelotpal Sahai (from 27 May 2013)

HSBC Midcap Equity Fund Dhiraj Sachdev (from 01 December 2009)

HSBC Progressive Themes Fund Dhiraj Sachdev (from 01 December 2009)

HSBC Tax Saver Equity Fund Aditya Khemani (from 24 February 2009)

HSBC Unique Opportunities Fund Gaurav Mehrotra and Amaresh Mishra (from 02 July 2012)

HSBC Dynamic Fund For Equity portion: Neelotpal Sahai (from 27 May 2013) & For Debt portion: Sanjay Shah (from 14 August 2009)

HSBC Emerging Markets Fund Piyush Harlalka (from 02 July 2012)

HSBC Small Cap Fund Dhiraj Sachdev (from 01 December 2009)

HSBC Brazil Fund Piyush Harlalka (from 02 July 2012)

Fund Manager’s Experience

Dhiraj Sachdev Senior Vice President and Fund Manager - EquitiesB.Com., ACA, Grad CWA, Diploma in Foreign Trade Management (DFTM)Experience:Over 17 years experience in Equity Research and Fund Management. l HSBC Asset Management (India) Private Ltd Senior Vice President & Fund Manager, from October 2011 to present, Senior Fund Manager from 1 December 2009 to September 2011, Head of Equity-Portfolio Management Services from October 2005 to November 2009 l ASK Raymond James Securities India Private Ltd Portfolio Manager from October 2003 to September 2005 l HDFC Bank Ltd Senior Manager Equities from November 1999 to September 2003 l DSQ Software Ltd Business Analyst from June 1999 to November 1999 Probity Research & Services Ltd (India Infoline Ltd) Research Analyst from November 1998 to May 1999 Ford Brothers Capital Services (P) Ltd Manager Research from July 1996 to Sept 1998

Neelotpal Sahai Senior Fund Manager - EquitiesB.Tech, PGDM (IIM Kolkata) Experience:Over 18 years of experience in Research and Fund Management. l HSBC Asset Management (India) Private Ltd Senior Fund Manager – Equities from April 2013 onwards. l IDFC Asset Management Company Ltd. Director from February 2006 to April 2013 l Motilal Oswal Securities Ltd Senior Research Analyst from March 2005 to January 2006 l Infosys Ltd Senior Project Manager from June 1999 to March 2005 l Vickers Ballas Securities Ltd Analyst from September 1998 to June 1999 l SBC Warburg Analyst from May 1997 to May 1998 l UTI Securities Ltd Equity Analyst from June 1995 to May 1997

Fund Managers - Equity December 2013

24

l

l

Gaurav MehrotraVice President & Assistant Fund ManagerPost Graduate Diploma in Business Management, Bachelor of EngineeringExperience: Over 8 years experience in research. HSBC Asset Management (India) Private Ltd Vice President & Assistant Fund Manager, from April 2012 to present, Associate Vice President, Investment Management from September 2007 to March 2012 JPMorgan Services India Private Ltd Equity Research from August 2005 to September 2007 Tata Consultancy Services Ltd Business Analyst from June 2004 to July 2005

Aditya KhemaniVice President & Fund Manager - EquitiesB.Com. (Hons.), Post Graduate Diploma in Business ManagementExperience: Over 8 years experience in research. l HSBC Asset Management (India) Private Ltd Vice President & Fund Manager (Equity), from April 2012 to present, Assistant Fund Manager, Equities from February 2009 to March 2012; Associate Vice President - Investment Management from October 2007 to February 2009. l SBI Funds Management India Private Ltd Senior Manager - Equity Research from March 2007 to September 2007 l Prudential ICICI Asset Management Company India Private Ltd Assistant Manager - Equity Research from December 2005 to February 2007 l Morgan Stanley Advantage Services India Private Ltd Research Associate from May 2005 to November 2005

Amaresh Mishra Vice President & Assistant Fund ManagerPost Graduate Diploma in Business Manager Management Bachelor of Engineering (Chemical) Experience: Over 8 years of experience in Equities & Sales l HSBC Asset Management (India) Private Ltd Vice President & Assistant Fund Manager, from April 2012 to present, Associate Vice President, Investment Management from April 2008 to March 2012, Associate Vice President, Equities from October 2007 to March 2008; Associate Vice President, Sales and Distribution from March 2005 to September 2007 l Centre for Science and Environment Trainee Researcher from July 2001 to July 2002

Piyush Harlalka Vice President - Fixed Income M.B.A, (Finance), C.A., C.S. Experience:Over 7 years of experience in Research l HSBC Asset Management (India) Private Ltd

Vice President - Fixed Income from April 2012 to present; Associate Vice President - Fixed Income, from October 2010 to March 2012; Assistant Vice President, Investment Management, PMS, from December 2008 to October 2010; Research Analyst, from, July 2007 to November 2008. l Batlivala & Karanai Securities Pvt. Ltd., Research Analyst from April 2006 to June 2007

Fund Managers - Equity December 2013

25

l

l

l

Funds Managed by Neelotpal Sahai.

Comparative Performance of Equity Schemes December 2013

HSBC Equity Fund Date of Inception : 10 Dec 02Scheme Name & Benchmarks Jan 13 -

Dec 13Jan 12 - Dec 12

Jan 11 - Dec 11

Since Inception

HSBC Equity Fund - Growth 2.45% 23.28% -22.68% 24.18%S&P BSE 200 (Scheme Benchmark) 3.45% 30.89% -26.95% 18.55%CNX Nifty (Standard Benchmark) 5.93% 27.43% -24.62% 17.45%`10,000, if invested in HEF, would have become `10,245 `12,328 `7,732 `1,10,492

`10,000, if invested in S&P BSE 200, would have become `10,345 `13,089 `7,305 `66,039

`10,000, if invested in CNX Nifty, would have become `10,593 `12,743 `7,538 `59,551

HSBC India Opportunities Fund Date of Inception : 24 Feb 04Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC India Opportunities Fund - Growth 7.15% 25.07% -18.66% 15.39%S&P BSE 500 (Scheme Benchmark) 2.32% 31.12% -27.41% 13.46%CNX Nifty (Standard Benchmark) 5.93% 27.43% -24.62% 13.42%`10,000, if invested in HIOF, would have become `10,715 `12,507 `8,134 `41,020



26

Data for the period January to December has been considered in all cases, except for ‘Since Inception’ returns. ‘Since Inception’ (%) returns are compounded annualised, other % returns are absolute. ‘Since inception’ returns are calculated on Rs 10 invested at inception. Standard benchmark is prescribed by SEBI for long-term equity schemes and is used for comparison purposes. Returns on Rs 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be minor differences between point-to-point returns vis-a-vis returns indicated above.

Past performance may or may not be sustained in the future. Refer note below.



HSBC Dynamic Fund Date of Inception : 24 Sep 07Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC Dynamic Fund - Growth -1.92% 22.28% -22.02% 0.80%S&P BSE 200 (Scheme Benchmark) 3.45% 30.89% -26.95% 3.25%CNX Nifty (Standard Benchmark) 5.93% 27.43% -24.62% 3.99%`10,000, if invested in HDF, would have become `9,808 `12,228 `7,798 `10,513



Fund Managed by Neelotpal Sahai (for Equity portion)Sanjay Shah (for Fixed Income portion)


27


HSBC Brazil Fund Date Of Inception : 06 May 11Scheme Name & Benchmarks Jan 13 -


Since Inception

HSBC Brazil Fund - Growth -10.57% 6.58% -4.02%MSCI Brazil 10/40 Index (Scheme Benchmark) -17.24% -2.15% -15.28%CNX Nifty (Standard Benchmark) 5.93% 27.43% 4.90%`10,000, if invested in HBF, would have become `8,943 `10,658 `8,966

`10,000, if invested in MSCI Brazil 10/40 Index, would have become `8,276 `9,785 `6,433

`10,000, if invested in CNX Nifty, would have become `10,593 `12,743 `11,357


HSBC Emerging Markets Fund Date of Inception : 17 Mar 08Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC Emerging Markets Fund - Growth 1.35% 22.04% -14.10% 2.38%MSCI Emerging Market Index (Scheme Benchmark) 0.92% 13.92% -14.67% 1.42%

CNX Nifty (Standard Benchmark) 5.93% 27.43% -24.62% 5.98%`10,000, if invested in HMEF, would have become `10,135 `12,204 `8,590 `11,461

`10,000, if invested in MSCI Emerging Market Index, would have become `10,092 `11,392 `8,533 `10,852



Funds Managed by - Piyush Harlalka.

HSBC Unique Opportunities Fund Date of Inception : 21 Mar 07Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC Unique Opportunities Fund - Growth -2.05% 31.77% -27.72% 2.14%S&P BSE 200 (Scheme Benchmark) 3.45% 30.89% -26.95% 7.60%CNX Nifty (Standard Benchmark) 5.93% 27.43% -24.62% 7.89%`10,000, if invested in HUOF, would have become `9,795 `13,177 `7,228 `11,546




Fund Managed by Gaurav Mehrotra and Amaresh Mishra.

HSBC Tax Saver Equity Fund Date of Inception : 05 Jan 07Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC Tax Saver Equity Fund - Growth 2.14% 38.94% -24.24% 8.18%S&P BSE 200 (Scheme Benchmark) 3.45% 30.89% -26.95% 6.18%CNX Nifty (Standard Benchmark) 5.93% 27.43% -24.62% 6.79%`10,000, if invested in HTSF, would have become `10,214 `13,894 `7,576 `17,332




Fund Managed by - Aditya Khemani.


28


HSBC Small Cap Fund Date of Inception : 24 Mar 08Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC Small Cap Fund - Growth -6.29% 44.91% -46.64% -0.06%S&P BSE Small Cap (Scheme Benchmark) -12.10% 32.91% -42.61% -1.02%CNX Nifty (Standard Benchmark) 5.93% 27.43% -24.62% 5.57%`10,000, if invested in HSCF, would have become `9,371 `14,491 `5,336 `9,965

`10,000, if invested in S&P BSE Smallcap, would have become `8,790 `13,291 `5,739 `9,425



HSBC Progressive Themes Fund Date of Inception : 23 Feb 06Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC Progressive Themes Fund - Growth -20.30% 48.48% -40.51% -0.09%S&P BSE 200 (Scheme Benchmark) 3.45% 30.89% -26.95% 9.07%CNX Nifty (Standard Benchmark) 5.93% 27.43% -24.62% 9.63%`10,000, if invested in HPTF, would have become `7,970 `14,848 `5,949 `9,929




Funds Managed by - Dhiraj Sachdev.

HSBC Midcap Equity Fund Date of Inception : 19 May 05Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC Midcap Equity Fund - Growth -4.44% 47.65% -43.47% 8.22%S&P BSE Midcap (Scheme Benchmark) -6.84% 38.72% -34.19% 8.77%CNX Nifty (Standard Benchmark) 5.93% 27.43% -24.62% 14.30%`10,000, if invested in HMEF, would have become `9,556 `14,765 `5,653 `19,769

`10,000, if invested in S&P BSE Midcap, would have become `9,316 `13,872 `6,581 `20,653



An Open Ended Fund with Regular & Savings Plans.Monthly income is not assured and is subject to availability of distributable surplus.Investment Objective: Seeks to generate reasonable returns through investments in Debt and Money Market Instruments. The secondary objective of the scheme is to invest in equity and equity related instruments to seek capital appreciation.

Issuer

MarketValue(` in

Lacs)

% toNet

AssetsRating

Money Market InstrumentsCertificate of DepositState Bank of Patiala 285.91 1.22% [ICRA]A1+Corporate/PSU DebtCorporate Bonds / DebenturesBajaj Finance 1,494.68 6.40% [ICRA]AA+HDFC 1,174.83 5.03% CRISIL AAARural Electrification Corporation 891.75 3.82% CARE AAAPower Finance Corporation 827.15 3.54% CRISIL AAAHDFC 499.72 2.14% CRISIL AAAPower Finance Corporation 493.90 2.12% CRISIL AAALIC Housing Finance 487.77 2.09% CRISIL AAAPower Finance Corporation 315.11 1.35% CRISIL AAANABARD 199.09 0.85% CRISIL AAAEquityEquitiesShree Cements 489.89 2.10%ITC 365.30 1.56%HDFC Bank 365.08 1.56%ICICI Bank 313.69 1.34%McLeod Russel India 263.20 1.13%MRF 251.74 1.08%Grasim Industries 244.31 1.05%Supreme Industries 229.53 0.98%Crompton Greaves 205.92 0.88%Tata Consultancy Services 204.72 0.88%Divi's Laboratories 195.56 0.84%Motherson Sumi Systems 191.21 0.82%Larsen & Toubro 176.59 0.76%HDFC 176.41 0.76%Karur Vysya Bank 161.88 0.69%Oil & Natural Gas Corporation 158.90 0.68% N.ABharti Airtel 147.95 0.63%The Ramco Cements 143.66 0.62%Petronet LNG 137.81 0.59%Maruti Suzuki India 136.70 0.59%IPCA Laboratories 135.45 0.58%IndusInd Bank 128.31 0.55%Havells India 128.13 0.55%LIC Housing Finance 124.97 0.54%United Spirits 119.99 0.51%Amara Raja Batteries 118.38 0.51%Tech Mahindra 115.78 0.50%Orient Cement 111.43 0.48%Nestle India 105.79 0.45%Sanghvi Movers 64.44 0.28%Orient Paper & Industries 35.62 0.15%Hindustan Dorr-Oliver 26.55 0.11%Government Securities7.28% GOVT OF INDIA RED 03-06-2019 2,204.10 9.44% Sovereign8.83% GOVT OF INDIA RED 25-11-2023 1,720.86 7.37% Sovereign8.12% GOVT OF INDIA RED 10-12-2020 1,515.91 6.49% Sovereign8.28% GOVT OF INDIA RED 21-09-2027 1,279.81 5.48% Sovereign7.16% GOVT OF INDIA RED 20-05-2023 1,220.70 5.23% Sovereign9.20% GOVT OF INDIA RED 30-09-2030 849.92 3.64% Sovereign9.23% GOVT OF INDIA RED 23-12-2043 410.49 1.76% Sovereign8.30% GOVT OF INDIA RED 31-12-2042 407.25 1.74% Sovereign9.39% GUJARAT SDL RED 20-11-2023 290.36 1.24% SovereignZero Coupon BondsHDFC 298.11 1.28% CRISIL AAATotal 96.98%

HSBC MIP - Savings Plan (HMIP-S) December 2013

29

Date of Allotment 24-Feb-04Benchmark CRISIL MIP

Blended IndexNAV (Growth) per unit(as on 31.12.13)

` 23.4221

Average Maturity of Portfolio

91.50 months

Modified Durationof Portfolio

54.69 months

Fund Manager Aditya Khemani(for Equity portion)Sanjay Shah &Ruchir Parekh(for Debt portion)

SIP AvailableMinimum Application AmountGrowth `10,000Quarterly Dividend `10,000Monthly Dividend `25,000SIP `1,000 p.m.Exit Load@ NilTotal Expense Ratio as on December 31, 2013


Regular 2.31% Direct Plan 1.79% Excludes service tax on Investment Management fees of 0.18% of Total Net Assets. @ Effective from March 1, 2013 for prospective investments.

Asset AllocationGovernment Securities 42.39%Corporate/ PSU Debt 28.62%Equity 24.75%Net Current Assets 2.99%Money Market Instrument 1.22%Cash Equivalents 0.03%Total Net Assets 100.00%

Issuer

MarketValue(` in

Lacs)

% toNet

AssetsRating

Cash EquivalentsCBLOs 2.39 0.01%Reverse Repos 4.91 0.02%Net Current Assets 694.56 2.99%Total Net Assets as on 31 December 2013 23,344.18 100.00%

Rating ProfileSovereign 42.39%Equity 24.75%AAA and equivalents 23.44%AA+/ AA-/ AA and equivalents 6.40%Net Current Assets 2.99%Reverse Repos/ CBLOs 0.03%Total Net Assets 100.00%

HSBC MIP - Savings Plan (HMIP-S) December 2013

30





HSBC MIP - Savings Plan - Monthly Dividend25-Oct-13 0.05065 0.04851 12.087929-Nov-13 0.05065 0.04851 12.077827-Dec-13 0.05065 0.04851 12.0865HSBC MIP - Savings Plan - Monthly Dividend - Direct Plan25-Oct-13 0.05065 0.04851 12.292429-Nov-13 0.05065 0.04851 12.289127-Dec-13 0.05065 0.04851 12.3038HSBC MIP - Savings Plan - Quarterly Dividend14-Jun-13 0.17144 0.16419 12.473213-Sep-13 0.15585 0.14926 11.915013-Dec-13 0.15585 0.14926 12.0933HSBC MIP - Savings Plan - Quarterly Dividend - Direct Plan13-Dec-13 0.11689 0.11195 12.4703


This Product is suitable for investors who are seeking* :l Regular Income over medium terml Investment in fixed income (debt and money market instruments) as well as equity and equity related securitiesl Medium risk (Yellow)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

An Open Ended Fund with Regular & Savings Plans. Monthly income is not assured and is subject to availability of distributable surplus.Investment Objective: Seeks to generate reasonable returns through investments in Debt and Money Market Instruments. The secondary objective of the scheme is to invest in equity and equity related instruments to seek capital appreciation.

Issuer

MarketValue(` in

Lacs)

% toNet

AssetsRating

Money Market InstrumentsCertificate of DepositState Bank of Patiala 207.04 1.50% [ICRA]A1+Corporate/PSU DebtCorporate Bonds / DebenturesBajaj Finance 996.46 7.20% [ICRA]AA+NABARD 796.34 5.75% CRISIL AAAHDFC 783.22 5.66% CRISIL AAARural Electrification Corporation 581.57 4.20% CARE AAAPower Finance Corporation 493.90 3.57% CRISIL AAALIC Housing Finance 487.77 3.52% CRISIL AAAPower Finance Corporation 389.24 2.81% CRISIL AAAPower Finance Corporation 219.62 1.59% CRISIL AAAEquityEquitiesITC 156.09 1.13%Shree Cements 154.37 1.12%HDFC Bank 141.63 1.02%ICICI Bank 140.09 1.01%Supreme Industries 119.49 0.86%MRF 114.25 0.83%HDFC 89.40 0.65%McLeod Russel India 88.76 0.64%Motherson Sumi Systems 82.56 0.60%Bharti Airtel 81.24 0.59%Tata Consultancy Services 73.85 0.53%Petronet LNG 72.49 0.52%Crompton Greaves 70.79 0.51%Tech Mahindra 65.24 0.47%Divi's Laboratories 65.20 0.47% N.A.Grasim Industries 57.01 0.41%Larsen & Toubro 56.72 0.41%Maruti Suzuki India 52.33 0.38%Karur Vysya Bank 50.25 0.36%Oil & Natural Gas Corporation 49.11 0.35%IPCA Laboratories 48.53 0.35%Havells India 46.66 0.34%Amara Raja Batteries 45.75 0.33%LIC Housing Finance 43.85 0.32%Nestle India 41.26 0.30%Orient Cement 28.18 0.20%Orient Paper & Industries 9.01 0.07%Hindustan Dorr-Oliver 7.97 0.06%Sanghvi Movers 5.92 0.04%Government Securities7.28% GOVT OF INDIA RED 03-06-2019 1,288.05 9.30% Sovereign8.83% GOVT OF INDIA RED 25-11-2023 1,075.54 7.77% Sovereign8.12% GOVT OF INDIA RED 10-12-2020 815.16 5.89% Sovereign8.28% GOVT OF INDIA RED 21-09-2027 783.65 5.66% Sovereign7.16% GOVT OF INDIA RED 20-05-2023 693.78 5.01% Sovereign9.20% GOVT OF INDIA RED 30-09-2030 514.95 3.72% Sovereign8.30% GOVT OF INDIA RED 31-12-2042 285.08 2.06% Sovereign9.23% GOVT OF INDIA RED 23-12-2043 245.29 1.77% Sovereign9.39% GUJARAT SDL RED 20-11-2023 130.16 0.94% SovereignZero Coupon BondsHDFC 596.21 4.31% CRISIL AAATotal 97.10%

HSBC MIP - Regular Plan (HMIP-R) December 2013

31

Date of Allotment 24-Feb-04Benchmark CRISIL MIP

Blended IndexNAV (Growth) per unit(as on 31.12.13)

` 20.3709


87.42 months


52.80 months

Fund Manager Aditya Khemani(for Equity portion)Sanjay Shah &Ruchir Parekh(for Debt portion)

SIP AvailableMinimum Application AmountGrowth `10,000Quarterly Dividend `10,000Monthly Dividend `25,000SIP `1,000 p.m.Exit Load@ NilTotal Expense Ratio as on December 31, 2013


Regular 2.40% Direct Plan 1.85% Excludes service tax on Investment Management fees of 0.18% of Total Net Assets.@ Effective from March 1, 2013 for prospective investments.

Asset AllocationGovernment Securities 42.12%Corporate/ PSU Debt 38.61%Equity 14.87%Net Current Assets 2.86%Money Market Instrument 1.50%Cash Equivalents 0.04%Total Net Assets 100.00%

Issuer

MarketValue(` in

Lacs)

% toNet

AssetsRating

Cash EquivalentsCBLOs 1.85 0.01%Reverse Repos 3.80 0.03%Net Current Assets 396.37 2.86%Total Net Assets as on 31 December 2013 13,843.06 100.00%

Rating ProfileSovereign 42.12%AAA and equivalents 32.91%Equity 14.87%AA+/ AA-/ AA and equivalents 7.20%Net Current Assets 2.86%Reverse Repos/ CBLOs 0.04%Total Net Assets 100.00%

HSBC MIP - Regular Plan (HMIP-R) December 2013

32





HSBC MIP - Regular Plan - Monthly Dividend25-Oct-13 0.05065 0.04851 11.067729-Nov-13 0.05065 0.04851 11.033227-Dec-13 0.05065 0.04851 10.9999HSBC MIP - Regular Plan - Quarterly Dividend14-Jun-13 0.17144 0.16419 11.784813-Sep-13 0.15585 0.14926 11.232213-Dec-13 0.15585 0.14926 11.3097


This Product is suitable for investors who are seeking* :l Regular Income over medium terml Investment in fixed income (debt and money market instruments) as well as equity and equity related securitiesl Medium risk (Yellow)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

An Open Ended Income SchemeInvestment Objective: Aims to provide reasonable income through a diversified portfolio of fixed income securities. The AMC’s view of interest rate trends and the nature of the Plans will be reflected in the type and maturities of securities in which the Short Term and Investment Plans are invested.

Issuer

MarketValue(` in

Lacs)

% toNet

AssetsRating

Securitised DebtInvestments - Asset Back Security

India MBS 2002 Series I 22.24 0.24% CRISIL AAA (SO)

Money Market InstrumentsCertificate of DepositState Bank of Patiala 197.18 2.15% [ICRA]A1+Corporate/PSU DebtCorporate Bonds / DebenturesIndian Railway Finance Corporation 881.08 9.61% CRISIL AAAState Bank of India 684.84 7.47% CRISIL AAAHDFC 478.59 5.22% CRISIL AAARural Electrification Corporation 474.95 5.18% CARE AAARural Electrification Corporation 445.07 4.86% CRISIL AAAHDFC 391.61 4.27% CRISIL AAAPower Finance Corporation 301.27 3.29% CRISIL AAAPower Finance Corporation 143.23 1.56% CRISIL AAAGovernment Securities8.12% GOVT OF INDIA RED 10-12-2020 1,577.88 17.21% Sovereign8.28% GOVT OF INDIA RED 21-09-2027 816.11 8.90% Sovereign8.83% GOVT OF INDIA RED 25-11-2023 585.29 6.39% Sovereign7.28% GOVT OF INDIA RED 03-06-2019 502.20 5.48% Sovereign7.16% GOVT OF INDIA RED 20-05-2023 395.19 4.31% Sovereign9.39% GUJARAT SDL RED 20-11-2023 350.43 3.82% Sovereign9.20% GOVT OF INDIA RED 30-09-2030 329.97 3.60% Sovereign8.30% GOVT OF INDIA RED 31-12-2042 122.18 1.33% Sovereign9.23% GOVT OF INDIA RED 23-12-2043 90.11 0.98% Sovereign5.59% GOVT OF INDIA RED 04-06-2016 0.37 0.00% SovereignTotal 95.87%Cash EquivalentsCBLOs 11.26 0.12%Reverse Repos 23.10 0.25%Net Current Assets 341.67 3.76%Total Net Assets as on 31 December 2013 9,165.81 100.00%

HSBC Income Fund - Investment Plan (HIF-IP) December 2013

33

Date of Allotment 10-Dec-02Benchmark CRISIL Composite

Bond Fund IndexNAV (Growth) per unit(as on 31.12.13)

` 20.3976


92.66 months


57.53 months

Yield To Maturity* 9.35%Fund Manager Ruchir Parekh &

Sanjay ShahSIP AvailableMinimumApplicationAmount

` 10,000` 1,000 p.m.(SIP)

Exit Load@ NilTotal Expense Ratio as on December 31, 2013 Regular 1.85%Direct Plan 1.10%Excludes service tax on Investment Management fees of 0.12% of Total Net Assets.

Annualised Expense Ratio from 1st April 2013 onwards Regular 1.85%Direct Plan 0.84%Excludes service tax on Investment Management fees of 0.12% of Total Net Assets.

@ Effective from March 1, 2013 for prospective investments.* Based on invested Amount

Asset AllocationGovernment Securities 52.02%Corporate / PSU Debt 41.46%Net Current Assets 3.76%Money Market Instrument 2.15%Cash Equivalents 0.37%Securitised Debt 0.24%





HSBC Income Fund - Investment Plan - Regular Option - Quarterly Dividend14-Jun-13 0.19482 0.18658 11.801813-Sep-13 0.19482 0.18658 11.039413-Dec-13 0.15585 0.14926 10.8194HSBC Income Fund - Investment Plan - Institutional Option - Quarterly Dividend12-Jun-09 0.11387 0.10598 11.029411-Sep-09 0.11387 0.10598 10.996011-Dec-09 0.11387 0.10598 11.0973

Rating ProfileSovereign 52.02%AAA and equivalents 43.85%Net Current Assets 3.76%Reverse Repos/ CBLOs 0.37%

HSBC Income Fund - Investment Plan (HIF-IP) December 2013

34


This Product is suitable for investors who are seeking* :l Regular Income over long terml Investment in diversified portfolio of fixed income securitiesl Low risk (Blue)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

An Open Ended Income SchemeInvestment Objective: Aims to provide reasonable income through a diversified portfolio of fixed income securities. The AMC’s view of interest rate trends and the nature of the Plans will be reflected in the type and maturities of securities in which the Short Term and Investment Plans are invested.

Issuer

MarketValue(` in

Lacs)

% toNet

AssetsRating

Money Market InstrumentsCertificate of DepositPunjab & Sind Bank 2,407.18 2.94% [ICRA]A1+Bank of Maharashtra 2,069.34 2.53% CRISIL A1+UCO Bank 1,966.68 2.41% CRISIL A1+Central Bank of India 1,773.76 2.17% CARE A1+State Bank of Patiala 1,422.57 1.74% [ICRA]A1+Kotak Mahindra Bank 967.14 1.18% CRISIL A1+State Bank of Hyderabad 688.56 0.84% [ICRA]A1+Corporation Bank 492.85 0.60% CRISIL A1+Indian Overseas Bank 492.58 0.60% [ICRA]A1+Karur Vysya Bank 446.42 0.55% [ICRA]A1+Oriental Bank of Commerce 444.86 0.54% CRISIL A1+ICICI Bank 178.73 0.22% [ICRA]A1+Kotak Mahindra Bank 160.26 0.20% CRISIL A1+State Bank of Patiala 145.89 0.18% [ICRA]A1+State Bank of Patiala 119.88 0.15% [ICRA]A1+Oriental Bank of Commerce 119.83 0.15% CRISIL A1+IndusInd Bank 94.25 0.12% CRISIL A1+ICICI Bank 92.85 0.11% [ICRA]A1+ING Vysya Bank 92.79 0.11% CRISIL A1+Yes Bank 92.78 0.11% [ICRA]A1+ICICI Bank 78.41 0.10% [ICRA]A1+Yes Bank 68.59 0.08% [ICRA]A1+Commercial PaperIL & FS 1,959.48 2.40% Fitch A1+Small Industries Development Bk of India 796.17 0.97% CARE A1+Sundaram Finance 294.14 0.36% [ICRA]A1+Kotak Mahindra Prime 273.10 0.33% CRISIL A1+Corporate/PSU Debt

Corporate Bonds / DebenturesRural Electrification Corporation 4,555.66 5.57% CARE AAARural Electrification Corporation 3,987.23 4.88% CRISIL AAAPower Finance Corporation 3,951.23 4.83% CRISIL AAALIC Housing Finance 3,902.14 4.77% CRISIL AAAShriram Transport Finance Company 2,988.36 3.65% CRISIL AAShriram Transport Finance Company 2,982.42 3.65% CRISIL AALIC Housing Finance 2,542.83 3.11% CRISIL AAAHDFC 2,498.61 3.06% CRISIL AAAHDFC 2,495.77 3.05% CRISIL AAABajaj Finance 2,493.55 3.05% [ICRA]AA+LIC Housing Finance 2,491.61 3.05% CRISIL AAABajaj Finance 2,491.14 3.05% [ICRA]AA+HDFC 2,490.06 3.05% CRISIL AAAHDFC 2,489.25 3.04% CRISIL AAARural Electrification Corporation 2,472.60 3.02% CRISIL AAAExport Import Bank of India 2,428.33 2.97% CRISIL AAAPower Finance Corporation 2,426.70 2.97% CRISIL AAAPower Finance Corporation 2,000.42 2.45% CRISIL AAAExport Import Bank of India 1,473.69 1.80% CRISIL AAAPower Grid Corporation of India 1,450.69 1.77% CRISIL AAAPower Grid Corporation of India 980.55 1.20% CRISIL AAAHDFC 979.03 1.20% CRISIL AAAShriram Transport Finance Company 497.89 0.61% CRISIL AANABARD 360.27 0.44% CRISIL AAAHDFC 339.07 0.41% CRISIL AAATata Capital Financial Services 309.00 0.38% CRISIL AA+Power Finance Corporation 299.39 0.37% CRISIL AAALIC Housing Finance 139.48 0.17% CRISIL AAAExport Import Bank of India 119.79 0.15% CRISIL AAA

HSBC Income Fund - Short Term Plan (HIF-STP) December 2013

35

Date of Allotment 10-Dec-02Benchmark CRISIL Short Term


` 20.5792


23.05 months


18.24 months



` 10,000` 1,000 p.m.(SIP)

Exit Load@ NilTotal Expense Ratio as on December 31, 2013 Regular 1.25%Institutional # 0.70%Institutional Plus # 0.60%Direct Plan 0.50%Excludes service tax on Investment Management fees of 0.05% of Total Net Assets.

Annualised Expense Ratio from 1st April 2013 onwards Regular 1.25%Institutional # 0.70%Institutional Plus # 0.60%Direct Plan 0.49%Excludes service tax on Investment Management fees of 0.05% of Total Net Assets.

@ Effective from March 1, 2013 for prospective investments.* Based on invested Amount# Plan(s) discontinued from accepting subscriptions w.e.f. October 01, 2012

Asset AllocationCorporate / PSU Debt 73.88%Money Market Instruments 21.69%Net Current Assets 3.07%Cash Equivalents 1.36%

Rating ProfileAAA and equivalents 79.75%AA+/ AA-/ AA and equivalents 15.82%

Net Current Assets 3.07%Reverse Repos/ CBLOs 1.36%





HSBC Income Fund - Short Term Plan - Regular Option - Monthly Dividend25-Oct-13 0.08585 0.08222 11.032029-Nov-13 0.05836 0.05589 10.981227-Dec-13 0.04864 0.04658 10.9687HSBC Income Fund - Short Term Plan - Monthly Dividend - Direct Plan27-Dec-13 0.05410 0.05181 11.0741HSBC Income Fund - Short Term Plan - Institutional Option - Monthly Dividend28-Dec-12 0.06057 0.05192 10.615124-Jan-13 0.06312 0.05410 10.635922-Feb-13 0.06114 0.05240 10.5969HSBC Income Fund - Short Term Plan - Institutional Plus Option - Monthly Dividend30-Dec-11 0.08478 0.07266 10.120027-Jan-12 0.05533 0.04742 10.086624-Feb-12 0.05663 0.04854 10.0881

HSBC Income Fund - Short Term Plan (HIF-STP) December 2013

36

Zero Coupon BondsTata Capital Financial Services 1,172.11 1.43% [ICRA]AA+HDFC 596.21 0.73% CRISIL AAATotal 95.57%Cash EquivalentsCBLOs 364.02 0.45%Reverse Repos 746.87 0.91%Net Current Assets 2,516.13 3.07%Total Net Assets as on 31 December 2013 81,771.15 100.00%


This Product is suitable for investors who are seeking* :l Regular Income over Medium terml Investment in diversified portfolio of fixed income securitiesl Low risk (Blue)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

An Open Ended Income SchemeInvestment Objective: Seeks to generate a reasonable return with commensurate risk through investments in floating rate debt instruments and fixed rate debt instruments swapped for floating rate returns. The Scheme may also invest in fixed rate money market and debt instruments.

Issuer

MarketValue(` in

Lacs)

% toNet

AssetsRating

Money Market InstrumentsCertificate of DepositPunjab & Sind Bank 2,258.40 17.25% [ICRA]A1+Corporation Bank 1,379.97 10.54% CRISIL A1+State Bank of Hyderabad 1,278.75 9.77% [ICRA]A1+Indian Overseas Bank 1,182.19 9.03% [ICRA]A1+Indian Bank 344.93 2.63% Fitch A1+Commercial PaperBajaj Finance 1,960.50 14.97% CRISIL A1+Small Industries Development Bk of India 1,691.87 12.92% CARE A1+Sundaram Finance 1,666.80 12.73% [ICRA]A1+Fixed DepositFixed Deposit8.85% JAMMU & KASHMR BK FD RED 14-03-14

1,300.00 9.93% Fixed Deposit

Total 99.77%Cash EquivalentsCBLOs 27.47 0.21%Reverse Repos 56.35 0.43%Net Current Assets -52.10 -0.41%Total Net Assets as on 31 December 2013 13,095.14 100.00%

HSBC Floating Rate Fund - Long Term Plan (HFRF-LTP)

December 2013

37

Date of Allotment 16-Nov-04Benchmark CRISIL Liquid Fund

IndexNAV (Growth) per unit(as on 31.12.13)

` 19.6130


2.26 months


2.08 months

Yield To Maturity* 8.71%Fund Manager Sanjay Shah &

Ruchir ParekhSIP AvailableMinimumApplicationAmount

` 10,000` 1,000 p.m.(SIP)

Sub OptionsGrowth, Daily Dividend, Reinvestment Weekly Dividend, Reinvestment, Monthly Dividend (Payout & Reinvestment)Exit Load@ Nil

Total Expense Ratio as on December 31, 2013 Regular # 1.29% Institutional 0.74%Direct Plan 0.19% Excludes service tax on Investment Management fees of 0.01% of Total Net Assets. Annualised Expense Ratio from 1st April 2013 onwards Regular # 1.30% Institutional 0.65%Direct Plan 0.19% Excludes service tax on Investment Management fees of 0.01% of Total Net Assets. @ Effective from March 1, 2013 for prospective investments.* Based on invested Amount# Plan(s) discontinued from accepting subscriptions w.e.f. October 01, 2012

Asset AllocationMoney Market Instruments 89.84%Fixed Deposit 9.93%Cash Equivalents 0.64%Net Current Assets -0.41%





HSBC Floating Rate Fund - Long Term Plan - Regular Option - Monthly Dividend25-Oct-13 0.06088 0.05830 10.078129-Nov-13 0.05896 0.05647 10.075727-Dec-13 0.05035 0.04822 10.0646HSBC Floating Rate Fund - Long Term Plan - Monthly Dividend - Direct Plan27-Sep-13 0.08216 0.07868 10.2424HSBC Floating Rate Fund - Long Term Plan - Institutional Option - Monthly Dividend30-Aug-13 0.13558 0.12985 10.561329-Nov-13 0.03524 0.03375 10.665627-Dec-13 0.06547 0.06270 10.6934

Rating ProfileAAA and equivalents 89.84%Unrated 9.93%Reverse Repos/ CBLOs 0.64%Net Current Assets -0.41%

HSBC Floating Rate Fund - Long Term Plan (HFRF-LTP)

December 2013

38


This Product is suitable for investors who are seeking* :l Liquidity over short terml Investment in floating rate and fixed rate Debt and Money Market Instrumentsl Low risk (Blue)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.


An Open Ended Liquid SchemeInvestment Objective: Aims to provide reasonable returns, commensurate with low risk while providing a high level of liquidity, through a portfolio of money market and debt securities.

IssuerMarketValue

(` in Lacs)

% toNet

AssetsRating

Money Market InstrumentsCertificate of DepositKotak Mahindra Bank 9,936.48 3.85% CRISIL A1+The Jammu & Kashmir Bank 9,911.82 3.84% CRISIL A1+Andhra Bank 9,520.61 3.69% CARE A1+Allahabad Bank 7,464.08 2.89% [ICRA]A1+Canara Bank 7,457.55 2.89% CRISIL A1+Karur Vysya Bank 6,993.90 2.71% [ICRA]A1+Oriental Bank of Commerce 4,981.11 1.93% CRISIL A1+State Bank of Patiala 4,980.59 1.93% [ICRA]A1+Union Bank of India 4,980.07 1.93% CRISIL A1+Karur Vysya Bank 4,975.26 1.93% [ICRA]A1+Bank of Maharashtra 4,971.69 1.93% CRISIL A1+Central Bank of India 4,963.02 1.92% CRISIL A1+Vijaya Bank 4,959.89 1.92% CRISIL A1+Allahabad Bank 4,959.32 1.92% [ICRA]A1+IndusInd Bank 4,958.36 1.92% CRISIL A1+Central Bank of India 4,955.57 1.92% CRISIL A1+State Bank of Patiala 4,948.61 1.92% [ICRA]A1+Bank of Baroda 4,945.26 1.92% [ICRA]A1+Punjab National Bank 4,944.34 1.92% CARE A1+Dena Bank 4,937.25 1.91% CRISIL A1+Bank of Baroda 4,936.26 1.91% [ICRA]A1+Indian Bank 4,139.18 1.60% Fitch A1+Canara Bank 2,490.39 0.97% CRISIL A1+Andhra Bank 2,488.56 0.96% CARE A1+Oriental Bank of Commerce 2,480.65 0.96% CRISIL A1+Kotak Mahindra Bank 2,480.24 0.96% CRISIL A1+Oriental Bank of Commerce 2,480.07 0.96% CRISIL A1+Canara Bank 2,468.05 0.96% CRISIL A1+Oriental Bank of Commerce 2,467.97 0.96% CRISIL A1+Commercial PaperICICI Securities Primary Dealership 9,870.95 3.83% CRISIL A1+Aditya Birla Finance 7,461.36 2.89% [ICRA]A1+Gruh Finance 7,409.55 2.87% CRISIL A1+Raymond 5,948.53 2.31% CARE A1+Magma Fincorp 4,974.77 1.93% CARE A1+Mahindra & Mahindra Financial Serv 4,974.51 1.93% CRISIL A1+Mahindra & Mahindra Financial Serv 4,970.83 1.93% CRISIL A1+L&T Finance 4,963.53 1.92% CARE A1+Aditya Birla Finance 4,963.34 1.92% [ICRA]A1+Sundaram Finance 4,959.78 1.92% [ICRA]A1+Chambal Fertilizers & Chemicals 4,941.05 1.92% CRISIL A1+Chambal Fertilizers & Chemicals 4,938.72 1.91% CRISIL A1+Raymond 2,979.74 1.15% CARE A1+Magma Fincorp 2,484.80 0.96% CARE A1+Godrej Agrovet 2,481.27 0.96% [ICRA]A1+Tube Investments Of India 2,469.35 0.96% CRISIL A1+Fixed DepositFixed Deposit8.50% CENTRAL BANK OF INDIA FD RED270114 1,000.00 0.39% Fixed Deposit

8.50% CENTRAL BANK OF INDIA FD RED280114 507.00 0.20% Fixed Deposit

Treasury Bill182 DAYS TREASURY BILL RED 14-02-2014 4,949.15 1.92% Sovereign

Total 90.85%

HSBC Cash Fund (HCF) December 2013

39

Date of Allotment 04-Dec-02Benchmark CRISIL Liquid Fund


` 1251.9994


1.06 months


0.98 months



` 10,000` 1,000 p.m.(SIP)

Sub OptionsGrowth, Daily Dividend, Reinvestment Weekly Dividend, Reinvestment, Monthly Dividend (Payout & Reinvestment) Exit Load@ Nil

Total Expense Ratio as on December 31, 2013 Regular # 1.00% Institutional # 0.35%Institutional Plus 0.02%Direct Plan 0.01%Currently there is no Service Tax levied due to nil Investment Management Fees being charged.Annualised Expense Ratio from 1st April 2013 onwards Regular # 1.00% Institutional # 0.35%Institutional Plus 0.05%Direct Plan 0.04%Currently there is no Service Tax levied due to nil Investment Management Fees being charged.@ Effective from March 1, 2013 for prospective investments.* Based on invested Amount# Plan(s) discontinued from accepting subscriptions w.e.f. October 01, 2012





HSBC Cash Fund - Institutional Option - Monthly Dividend25-Oct-13 6.06293 5.80659 1007.836829-Nov-13 6.99668 6.70087 1009.035027-Dec-13 5.32771 5.10245 1006.8933HSBC Cash Fund - Monthly Dividend - Direct Plan27-Dec-13 5.33513 5.10956 1006.8473HSBC Cash Fund - Institutional Plus Option - Monthly Dividend26-Aug-11 0.04886 0.04686 10.138329-Sep-11 0.05876 0.05636 10.150928-Oct-11 0.05244 0.05030 10.1428

Asset AllocationMoney Market Instruments 88.34%Cash Equivalents 9.39%Treasury Bill 1.92%Fixed Deposit 0.59%Net Current Assets -0.24%

Rating ProfileAAA and equivalents 88.34%Reverse Repos/ CBLOs 9.39%Sovereign 1.92%Unrated 0.59%Net Current Assets -0.24%

HSBC Cash Fund (HCF) December 2013

40


*** Service tax on AMC fees is charged in addition to the above stated TERs .

This Product is suitable for investors who are seeking* :l Overnight Liquidity over short terml Invests in Money Market Instrumentsl Low risk (Blue)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.


Cash EquivalentsCBLOs 7,935.38 3.08%Reverse Repos 16,281.23 6.31%Net Current Assets -647.21 -0.24%

Total Net Assets as on 31 December 2013 2,57,993.77 100.00%

HSBC Cash Fund

01 Dec 2013 to 05 Dec 2013***

06 Dec 2013 to 12 Dec 2013***

13 Dec 2013 to 31 Dec 2013***

Average for the Month

Normal (erst-while insti-plus)

0.02 0.09 0.02 0.04

Direct 0.01 0.07 0.01 0.02

Date of Allotment 05-Dec-03Benchmark I-Sec Composite


` 15.2460


113.14 months


64.62 months

Yield To Maturity* 9.04%Fund Manager Sanjay ShahSIP AvailableMinimum ` 10,000Application ` 1,000 p.m.(SIP)AmountExit Load@ Nil

Total Expense Ratio as on December 31, 2013 Regular 1.00% Direct Plan 0.50% Excludes service tax on Investment Management fees of 0.06% of Total Net Assets. Annualised Expense Ratio from 1st April 2013 onwards Regular 1.00% Direct Plan 0.50% Excludes service tax on Investment Management fees of 0.05% of Total Net Assets. @ Effective from March 1, 2013 for prospective investments.* Based on invested Amount

An Open Ended Gilt SchemeInvestment Objective: Aims to generate reasonable returns through investments in Government Securities of various maturities. The AMC’s view of interest rate trends and the nature of the plans will be reflected in the maturities of securities in which the Plans are invested.

Issuer

MarketValue(` in

Lacs)

% toNet

AssetsRating

Government Securities8.12% GOVT OF INDIA RED 10-12-2020 61.97 24.05% Sovereign7.28% GOVT OF INDIA RED 03-06-2019 60.45 23.46% Sovereign8.83% GOVT OF INDIA RED 25-11-2023 30.02 11.65% Sovereign8.30% GOVT OF INDIA RED 31-12-2042 18.10 7.02% Sovereign9.20% GOVT OF INDIA RED 30-09-2030 15.00 5.82% Sovereign8.28% GOVT OF INDIA RED 21-09-2027 13.91 5.40% Sovereign7.16% GOVT OF INDIA RED 20-05-2023 13.17 5.11% Sovereign9.39% GUJARAT SDL RED 20-11-2023 10.01 3.89% Sovereign9.23% GOVT OF INDIA RED 23-12-2043 5.01 1.94% SovereignTotal 88.34%Cash EquivalentsCBLOs 7.39 2.87%Reverse Repos 15.16 5.88%Net Current Assets 7.53 2.91%Total Net Assets as on 31 December 2013 257.71 100.00%





HSBC Gilt Fund - Monthly Dividend31-Oct-08 0.06136 0.05711 10.807728-Nov-08 0.04193 0.03903 10.785526-Dec-08 0.03400 0.03164 10.7764

Asset AllocationGovernment Securities 88.34%Cash Equivalents 8.75%Net Current Assets 2.91%

Rating ProfileSovereign 88.34%Reverse Repos/ CBLOs 8.75%Net Current Assets 2.91%

HSBC Gilt Fund (HGF) December 2013

41


This Product is suitable for investors who are seeking* :l Regular Income over long terml Investment in Government Securitiesl Low risk (Blue)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.


An Open Ended Debt SchemeInvestment Objective: Seeks to provide liquidity and reasonable returns by investing primarily in a mix of short term debt and money market instruments.

Issuer

MarketValue(` in

Lacs)

% toNet

AssetsRating

Money Market InstrumentsCertificate of DepositIndian Overseas Bank 788.13 9.82% [ICRA]A1+Central Bank of India 689.79 8.59% CARE A1+Corporation Bank 591.42 7.37% CRISIL A1+State Bank of Hyderabad 491.83 6.13% [ICRA]A1+UCO Bank 491.67 6.12% CRISIL A1+Indian Bank 443.48 5.52% Fitch A1+Andhra Bank 396.69 4.94% CARE A1+Bank of Maharashtra 394.16 4.91% CRISIL A1+Punjab & Sind Bank 196.38 2.45% [ICRA]A1+Commercial PaperSundaram Finance 490.24 6.11% [ICRA]A1+Bajaj Finance 490.13 6.10% CRISIL A1+IL & FS 373.23 4.65% Fitch A1+Corporate/ PSU DebtCorporate Bonds / DebenturesPower Finance Corporation 500.11 6.23% CRISIL AAAHDFC 498.01 6.20% CRISIL AAAZero Coupon BondsSundaram Finance 443.64 5.53% [ICRA]AA+Fixed DepositFixed Deposit8.85% JAMMU & KASHMR BK FD RED 14-03-14 700.00 8.72% Fixed Deposit

Total 99.39%Cash EquivalentsCBLOs 36.24 0.45%Reverse Repos 74.35 0.93%Net Current Assets -60.43 -0.77%Total Net Assets as on 31 December 2013 8,029.07 100.00%

HSBC Ultra Short Term Bond Fund (HUSBF) December 2013

42

Date of Allotment 17-Oct-06Benchmark Customised

Benchmark Index**NAV (Growth) per unit(as on 31.12.13)

` 11.1061


5.65 months


5.02 months


Ruchir ParekhSIP AvailableMinimum ` 10,000Application ` 1,000 p.m.(SIP)Amount

Sub OptionsGrowth, Daily Dividend, Reinvestment Weekly Dividend, Reinvestment, Monthly Dividend (Payout & Reinvestment)Exit Load@ NilTotal Expense Ratio as on December 31, 2013 Regular # 1.28% Institutional 0.98%Institutional Plus # 0.23%Direct Plan 0.33%Excludes service tax on Investment Management fees of 0.03% of Total Net Assets.

Annualised Expense Ratio from 1st April 2013 onwards Regular # 1.30% Institutional 0.77%Institutional Plus # 0.25%Direct Plan 0.26%Excludes service tax on Investment Management fees of 0.02% of Total Net Assets.

@ Effective from March 1, 2013 for prospective investments.** Composite index of CRISIL Liquid Fund Index(90%) and CRISIL Short Term Bond Fund Index(10%).* Based on invested Amount# Plan(s) discontinued from accepting subscriptions w.e.f. October 01, 2012

Asset AllocationMoney Market Instruments 72.71%Corporate/ PSU Debt 17.96%Fixed Deposit 8.72%Cash Equivalents 1.38%Net Current Assets -0.77%

Rating ProfileAAA and equivalents 85.14%Unrated 8.72%AA+/ AA-/ AA and equivalents 5.53%

Reverse Repos/ CBLOs 1.38%Net Current Assets -0.77%





HSBC Ultra Short Term Bond Fund - Institutional Option - Monthly Dividend25-Oct-13 0.07530 0.07211 10.223429-Nov-13 0.06108 0.05850 10.205227-Dec-13 0.05300 0.05076 10.1948HSBC Ultra Short Term Bond Fund - Institutional Plus Option - Monthly Dividend28-Jan-11 0.04829 0.04501 10.382125-Feb-11 0.04125 0.03845 10.374125-Mar-11 0.05214 0.04859 10.3865

HSBC Ultra Short Term Bond Fund (HUSBF) December 2013

43


*** Service tax on AMC fees is charged in addition to the above stated TERs .

This Product is suitable for investors who are seeking* :l Liquidity over short terml Investment in Debt / Money Market Instrumentsl Low risk (Blue)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

HSBC Ultra Short Term Bond Fund

01 Dec 2013 to 05 Dec 2013***

06 Dec 2013 to 12 Dec 2013***

13 Dec 2013 to 31 Dec 2013***

Average for the Month

Normal (erst-while institu-tional plan)

0.25 0.25 0.25 0.25

Direct 0.35 0.35 0.35 0.35

An Open Ended Debt SchemeInvestment Objective: Seeks to deliver returns in the form of interest income and capital gains, along with high liquidity, commensurate with the current view on the markets and the interest rate cycle, through active invest-ment in debt and money market instruments.

IssuerMarketValue

(` in Lacs)

% toNet

AssetsRating

Money Market InstrumentsCertificate of DepositState Bank of Patiala 1,774.63 2.06% [ICRA]A1+

Corporate/PSU DebtCorporate Bonds / DebenturesIndian Railway Finance Corporation 7,259.31 8.42% CRISIL AAA

HDFC 4,307.27 5.00% CRISIL AAA

Rural Electrification Corporation 4,158.25 4.82% CARE AAA

State Bank of India 3,717.72 4.31% CRISIL AAA

Rural Electrification Corporation 3,511.09 4.07% CRISIL AAA

Power Finance Corporation 2,711.43 3.14% CRISIL AAA

Shriram Transport Finance Company 2,485.35 2.88% CRISIL AA

Shriram Transport Finance Company 1,991.56 2.31% CRISIL AA

Power Finance Corporation 1,702.95 1.97% CRISIL AAA

HDFC 1,076.93 1.25% CRISIL AAA

Shriram Transport Finance Company 996.12 1.16% CRISIL AA

Power Finance Corporation 982.40 1.14% CRISIL AAA

Power Finance Corporation 754.35 0.87% CRISIL AAA

Government Securities7.28% GOVT OF INDIA RED 03-06-2019 11,290.20 13.09% Sovereign

8.12% GOVT OF INDIA RED 10-12-2020 10,330.09 11.98% Sovereign







9.39% GUJARAT SDL RED 20-11-2023 1,722.11 2.00% Sovereign

Zero Coupon BondsHDFC 298.11 0.35% CRISIL AAA

Total 96.55%Cash EquivalentsCBLOs 36.28 0.04%Reverse Repos 74.44 0.09%Net Current Assets 2,853.58 3.32%Total Net Assets as on 31 December 2013 86,231.05 100.00%

HSBC Flexi Debt Fund (HFDF) December 2013

44

Date of Allotment 05-Oct-07Benchmark CRISIL Composite


` 16.5339


92.08 months


55.58 months


Ruchir ParekhSIP AvailableMinimum ` 10,000Application ` 1,000 p.m.(SIP)AmountExit Load@ Nil

Total Expense Ratio as on December 31, 2013 Regular # 1.85%Institutional 1.60% Direct Plan 0.85%Excludes service tax on Investment Management fees of 0.00% of Total Net Assets.Annualised Expense Ratio from 1st April 2013 onwards Regular # 1.85%Institutional 1.60% Direct Plan 0.81%Excludes service tax on Investment Management fees of 0.06% of Total Net Assets.@ Effective from March 1, 2013 for prospective investments.* Based on invested Amount# Plan(s) discontinued from accepting subscriptions w.e.f. October 01, 2012





HSBC Flexi Debt Fund - Regular Option - Monthly Dividend26-Apr-13 0.05836 0.04973 10.494931-May-13 0.11214 0.10740 10.671828-Jun-13 0.03263 0.03125 10.4175HSBC Flexi Debt Fund - Institutional Option - Monthly Dividend26-Apr-13 0.07409 0.06313 10.750531-May-13 0.11686 0.11191 10.917828-Jun-13 0.03489 0.03342 10.6570HSBC Flexi Debt Fund - Monthly Dividend - Direct Plan31-May-13 0.12506 0.11977 10.9844HSBC Flexi Debt Fund - Regular Option - Quarterly Dividend14-Jun-13 0.19482 0.18658 12.285813-Sep-13 0.19482 0.18658 11.671013-Dec-13 0.15585 0.14926 11.4631HSBC Flexi Debt Fund - Institutional Option - Quarterly Dividend14-Jun-13 0.19482 0.18658 12.195013-Sep-13 0.19482 0.18658 11.590213-Dec-13 0.15585 0.14926 11.3891HSBC Flexi Debt Fund - Quarterly Dividend - Direct Plan13-Dec-13 0.15585 0.14926 11.4883HSBC Flexi Debt Fund - Regular Option - Half Yearly Dividend16-Mar-12 0.35236 0.30201 11.267214-Sep-12 0.35236 0.30201 11.431515-Mar-13 0.35236 0.30201 11.6629HSBC Flexi Debt Fund - Institutional Option - Half-yearly Dividend15-Mar-13 0.35236 0.30201 10.9757HSBC Flexi Debt Fund - Half-yearly Dividend - Direct Plan13-Sep-13 0.31171 0.29853 10.7220

Asset AllocationGovernment Securities 52.80%Corporate / PSU Debt 41.69%Net Current Assets 3.32%Money Market Instruments 2.06%Cash Equivalents 0.13%

Rating ProfileSovereign 52.80%AAA and equivalents 37.40%AA+/ AA-/ AA and equivalents 6.35%Net Current Assets 3.32%Reverse Repos/ CBLOs 0.13%

HSBC Flexi Debt Fund (HFDF) December 2013

45


This Product is suitable for investors who are seeking* :l Regular Income over long terml Investment in Debt / Money Market Instrumentsl Low risk (Blue)*Investors should consult their financial advisers if in doubt about whether the product is suitable for them.Note: Risk may be represented as: (BLUE) investors understand that their principal will be at low risk (YELLOW) investors understand that their principal will be at medium risk (BROWN) investors understand that their principal will be at high risk

Name of Scheme Fund Manager

HSBC MIP - Savings & Regular Plan

For Debt portion: Sanjay Shah (from 14 August 2009) & Ruchir Parekh (from 25 January 2011) & For Equity portion: Aditya Khemani (from 24 February 2009)

HSBC Income Fund - Investment Plan

Ruchir Parekh (from 25 January 2011) &Sanjay Shah (from 09 January 2009)

HSBC Income Fund - Short Term Plan

Ruchir Parekh (from 25 January 2011) &Sanjay Shah (from 09 January 2009)

HSBC Floating Rate Fund Long Term Plan

Sanjay Shah (from 09 January 2009) & Ruchir Parekh (from 22 September 2012)

HSBC Cash Fund Ruchir Parekh (from 25 January 2011) &Sanjay Shah (from 22 September 2012)

HSBC Gilt Fund Sanjay Shah (from 09 January 2009)

HSBC Ultra Short Term Bond Fund

Sanjay Shah (from 22 September 2012) & Ruchir Parekh (from 22 September 2012)

HSBC Flexi Debt Fund Sanjay Shah (from 09 January 2009) &Ruchir Parekh (from 25 January 2011)

Fund Managers - MIP & Debt December 2013

46

Fund Manager’s ExperienceSanjay Shah Senior Vice President Head - Fixed IncomeB. Com, A.C.A., Post Graduate Diploma in ManagementExperience:Over 14 years of experience in research and risk l HSBC Asset Management (India) Private Ltd Senior Vice President & Fund Manager, Fixed Income since October 2011 to present, Vice President & Fund Manager, Fixed Income since December 2008 to September 2011. l FIL Fund Management Private Ltd Credit Analyst from September 2008 to December 2008 l Lehman Brothers Structured Financial Services Private Ltd Vice President, Convertible Products from September 2006 to Sep tember 2008 l Rabo India Finance Private Ltd Senior Manager – Credit Risk from July 2004 to September 2006 l ICICI Bank Ltd Manager, Credit Risk from January 2003 to June 2004 l SBI Funds Management Private Ltd Chief Manager, Debt Funds from June 1999 to January 2003

Ruchir ParekhSenior Vice President and Fund Manager - Fixed IncomeMBA, B.ComExperience:Over 16 years of experience in research and fixed income management l HSBC Asset Management (India) Private Ltd Senior Vice President & Fund Manager, Fixed Income since September 2011 to present, Vice President & Fund Manager, Fixed Income since January 2011 to September 2011. l AIG Global Asset Management (India) Private Ltd Fund Manager, Fixed Income from April 2007 - January 2011 l HDFC Asset Management Company Ltd Sr. Manager, Fixed Income Analyst from February 2003 - April 2007 l Bear Stearns & Co., New York, NY Fixed Income Analyst from October 2000 - March 2002 l Moodys Investors Service, New York, NY Senior Associate from June 1997 - October 2000

Comparative Performance of Debt Schemes December 2013

47

Data for the period January to December has been considered in all cases, except for ‘Since Inception’ returns. ‘Since Inception’ (%) returns are compounded annualised, other % returns are simple annualised. ‘Since inception’ returns are calculated on Rs 10 invested at inception. Standard benchmark is prescribed by SEBI and is used for comparison purposes. Returns on Rs 10,000 are point-to-point returns for the specific time period, invested at the start of the period. The returns provided above have been rounded off and hence there may be minor differences between point-to-point returns vis-a-vis returns indicated above.

HSBC MIP - Regular Plan Date of Inception : 24 Feb 04Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC MIP - Regular Plan - Growth 3.83% 13.16% 1.27% 7.48%Crisil MIP Blended Index (Scheme Benchmark) 4.13% 12.08% 1.73% 6.97%Crisil 1 Year T-Bill Index (Standard Benchmark) 5.83% 8.03% 6.44% 5.37%Crisil 10 Year Gilt Index (Standard Benchmark) -1.06% 9.41% 1.90% 4.08%`10,000, if invested in HMIP - R, would have become `10,383 `11,316 `10,127 `20,366

`10,000, if invested in Crisil MIP Blended Index, would have become `10,413 `11,208 `10,173 `19,433

`10,000, if invested in Crisil 1 Year T-Bill Index, would have become `10,583 `10,803 `10,644 `16,749

`10,000, if invested in Crisil 10 Year Gilt Index, would have become `9,894 `10,941 `10,190 `14,834

HSBC MIP - Savings Plan Date of Inception : 24 Feb 04Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC MIP - Savings Plan - Growth 3.76% 17.70% -1.99% 9.02%Crisil MIP Blended Index (Scheme Benchmark) 4.13% 12.08% 1.73% 6.97%Crisil 1 Year T-Bill Index (Standard Benchmark) 5.83% 8.03% 6.44% 5.37%Crisil 10 Year Gilt Index (Standard Benchmark) -1.06% 9.41% 1.90% 4.08%`10,000, if invested in HMIP - S, would have become `10,376 `11,770 `9,801 `23,433

`10,000, if invested in Crisil MIP Blended Index, would have become `10,413 `11,208 `10,173 `19,433



Funds Managed by - Sanjay Shah & Ruchir Parekh (for Debt portion) &Aditya Khemani (for Equity portion)



HSBC Gilt Fund Date of Inception : 05 Dec 03Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC Gilt Fund - Growth 2.98% 10.06% 8.93% 4.27%I-Sec Composite Index (Scheme Benchmark) 3.75% 11.06% 6.54% 6.40%Crisil 10 Year Gilt Index (Standard Benchmark) -1.06% 9.41% 1.90% 4.07%`10,000, if invested in HGF, would have become `10,298 `11,006 `10,893 `15,244

`10,000, if invested in I-Sec Composite Bond Fund Index, would have become `10,375 `11,106 `10,654 `18,691


Fund Managed by - Sanjay Shah.



48


47

HSBC FRF - LTP - Regular Plan Date of Inception : 16 Nov 04Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC FRF - LTP - Growth 9.03% 9.64% 9.06% 7.64%Crisil Liquid Fund Index (Scheme Benchmark) 9.04% 8.50% 8.17% 6.88%Crisil 1 Year T-Bill Index (Standard Benchmark) 5.83% 8.03% 6.44% 5.59%

`10,000, if invested HFRF - LTP, would have become `10,903 `10,964 `10,906 `19,587

`10,000, if invested in Crisil Liquid Fund Index, would have become `10,904 `10,850 `10,817 `18,360


Funds Managed by - Sanjay Shah & Ruchir Parekh.


HSBC Ultra Short Term Bond Fund$ Date of Inception : 17 Oct 06Scheme Name & Benchmarks Jan 13 - Dec 13 Since InceptionHSBC Ultra Short Term Bond Fund - Growth 8.83% 8.76%Customised Benchmark Index (Scheme Benchmark)* 8.96% 8.74%

Crisil 1 Year T-Bill Index (Standard Benchmark) 5.83% 6.21%

`10,000, if invested in HUSTBF, would have become `10,883 `11,109

`10,000, if invested in Customised Benchmark Index, would have become `10,896 `11,106

`10,000, if invested in Crisil 1 Year T-Bill Index, would have become `10,583 `10,783


HSBC Flexi Debt Fund Date of Inception: 05 Oct 07Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC Flexi Debt Fund - Growth 4.28% 10.07% 9.61% 8.40%Crisil Composite Bond Fund Index (Scheme Benchmark) 3.59% 9.34% 6.92% 6.37%

Crisil 10 Year Gilt Index (Standard Benchmark) -1.06% 9.41% 1.90% 5.33%`10,000, if invested in HFDF, would have become `10,428 `11,007 `10,961 `16,551

`10,000, if invested in Crisil Composite Bond Fund Index, would have become `10,359 `10,934 `10,692 `14,707



*Composite index of Crisil Liquid Fund Index(90%) and Crisil Short Term Bond Fund Index(10%).

$Pursuant to SEBI circular dated Sept 13, 2012, certain Plans/options within the schemes have been discontinued to comply with a single plan structure. Since there was no continuous NAV history available for the surviving Plan prior to 1 October 2012, returns since the said date have been considered for calculating performance. The inception date of HSBC Ultra Short Term Bond Fund however is 17 October 2006.


49


HSBC Income Fund - Investment Plan Date of Inception : 10 Dec 02Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC Income Fund - Investment Plan - Growth 2.68% 9.73% 8.88% 6.65%Crisil Composite Bond Fund Index (Scheme Benchmark) 3.59% 9.34% 6.92% 5.61%

Crisil 10 Year Gilt Index (Standard Benchmark) -1.06% 9.41% 1.90% 4.93%`10,000, if invested in HIF - IP, would have become `10,268 `10,973 `10,888 `20,393

`10,000, if invested in Crisil Composite Bond Fund Index, would have become `10,359 `10,934 `10,692 `18,297


HSBC Income Fund - S T P Date of Inception : 10 Dec 02Scheme Name & Benchmarks Jan 13 -


Jan 11 - Dec 11

Since Inception

HSBC Income Fund - S T P - Growth 7.00% 9.13% 8.88% 6.74%Crisil Short Term Bond Fund Index (Scheme Benchmark) 8.25% 9.10% 7.87% 6.55%

Crisil 1 Year T-Bill Index (Standard Benchmark) 5.83% 8.03% 6.44% 5.37%

`10,000, if invested in HIF -ST, would have become `10,700 `10,913 `10,888 `20,584

`10,000, if invested in Crisil Short Term Bond Fund Index, would have become `10,825 `10,910 `10,787 `20,183


Funds Managed by - Ruchir Parekh & Sanjay Shah.



HSBC Cash Fund@ Date of Inception: 04 Dec 02Scheme Name & Benchmarks

Last 7 Days as on 31 Dec

2013

Last 15 Days as on 31 Dec 2013

Last 30 Days as on 31

Dec 2013

Jan 13 - Dec 13

Jan 12 - Dec 12

Since Inception

HSBC Cash Fund - Growth 8.96% 8.99% 8.93% 9.30% 8.98% 8.95%

Crisil Liquid Fund Index (Scheme Benchmark)

6.40% 8.06% 8.98% 9.04% 8.50% 8.65%

Crisil 91 Day T-Bill Index (Standard Benchmark)

10.01% 9.22% 8.97% 8.27% 8.59% 8.12%

`10,000, if invested in HCF, would have become

`10,017 `10,037 `10,073 `10,930 `10,898 `12,523

`10,000, if invested in Crisil Liquid Fund Index, would have become

`10,012 `10,033 `10,074 `10,904 `10,850 `12,432

`10,000, if invested in Crisil 91 Day T-Bill Index, would have become

`10,019 `10,038 `10,074 `10,827 `10,859 `12,274


@Pursuant to SEBI circular dated Sept 13, 2012, certain Plans/options within the schemes have been discontinued to comply with a single plan structure. Since there was no continuous NAV history available for the surviving Plan prior to 19 May 2011, returns since the said date have been considered for calculating performance. The inception date of HSBC Cash Fund however is 4 December 2002.

Statutory Details & Disclaimers

All returns have been sourced from MutualFundsIndia Explorer software unless otherwise stated. With regard to equity schemes (including the equity component of MIPs), Fund performance is calculated on a total return basis (i.e. it includes dividends re-invested) while the benchmark is calculated on a price return basis (i.e. it does not consider dividends re-invested). This document has been prepared by HSBC Asset Management (India) Private Ltd (HSBC) for information purposes only and should not be construed as an offer or solicitation of an offer for purchase of any of the funds of HSBC Mutual Fund. All information contained in this document (including that sourced from third parties), is obtained from sources HSBC, the third party believes to be reliable but which it has not independently verified and HSBC, the third party makes no guarantee, representation or warranty and accepts no responsibility or liability as to the accuracy or completeness of such information. The information and opinions contained within the document are based upon publicly available information and rates of taxation applicable at the time of publication, which are subject to change from time to time. Expressions of opinion are those of HSBC only and are subject to change without notice. It does not have regard to specific investment objectives, financial situation and the particular needs of any specific person who may receive this document. Investors should seek financial advice regarding the appropriateness of investing in any securities or investment strategies that may have been discussed or recommended in this report and should understand that the views regarding future prospects may or may not be realized. Neither this document nor the units of HSBC Mutual Fund have been registered in any jurisdiction. The distribution of this document in certain jurisdictions may be restricted or totally prohibited and accordingly, persons who come into possession of this document are required to inform themselves about, and to observe, any such restrictions. Mutual fund investments are subject to market risks. Please read the Scheme Information Document carefully before investing.

Investors should not invest in the Scheme solely based on the information provided in this document and should read the Combined Scheme Information Document and, Statement of Additional Information of the Fund for details. This document does not constitute an offering document. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, on any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, with-out the prior written permission of HSBC Asset Management (India) Private Ltd.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

HSBC Asset Management (India) Private Limited, 16, V.N. Road, Fort, Mumbai-400001 Email: [email protected] Website: www.assetmanagement.hsbc.com/in

december 2013 - hsbc · 2014-01-15 · fund manager commentary december 2013 4 review: hsbc...

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